Mergers and acquisitions in energy market: A real option approach

This study presents real options in energy market and their application in specific geographical areas. The reason for this segmentation is to understand energy investors’ core interest and energy firms’ merger and acquisition (M&A) policy in each area. Moreover, research evaluates the investment alternatives and suggests the appropriate investment area. Oil and renewable energy sources among the energy alternatives are in the middle of a change which enforces energy players and governments to important decisions like mergers and acquisitions. These decisions usually become a simple dilemma which needs the appropriate answer. Study comes to suggest the most suitable route by modeling the relation between M&As and the energy market’s dynamic taking into consideration global economy’s situation. Findings support that real options may lead interested parties to logical and safe investments.