Developments, trends, business climate, conditions, factors influencing the efficiency and results of mergers and acquisitions (M&A) in the energy sector are explored in this research. PESTLE (political, economic, social, technological, legal, environmental) analysis was performed in order to determine the driving forces of M&As in the energy industry. Considering the motivation and main questions of the study, a sample of global M&A deals that have occurred during the period 1995–2020 has been analyzed. DataStream 5.1 database by Thomson Reuters was employed to identify the sample of global energy companies that took over another company in the period 1995–2020. According to the research, while the role and presence of M&As in the energy industry are increasing, the purpose of the M&A deals has changed remarkably. During 1995–2010, most M&A events were conducted in order to explore synergies and benefit from cost reduction. Since the last decade, firms are pursuing M&As in the search of growth opportunities, ensuring supply and reflecting demand for green development of ecological environment and ongoing changes in the nature of energy.

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The energy sector is experiencing various transformations. Simultaneously, merger and acquisition (M&A) activities in the sector are surging globally. Extensive research has focused on and analyzed M&As from the perspective of acquirer- and target-level financial performance. In comparison, a significantly lower number of studies have analyzed the macroeconomic impact of M&A activities. The field of and interests in sustainability have also been expanding in recent decades. Sustainable development goal 7 (SDG7), which calls for “affordable, reliable, sustainable and modern energy for all” by 2030, is among other sustainable development goals that were established by the UN (United Nations). However, the synthesis of indicators for measuring sustainable development and M&A performance remains a relatively vaguely explored field. Here, we perform SALSA (search, appraisal, synthesis, and analysis) and analyze which M&A and sustainable development performance indicators may be used when analyzing M&A within the energy sector. The employment of an eligible set of indicators measuring sustainable development and M&A performance may be used by practitioners, governments, and scholars for the purpose of monitoring, tracking, and the communication of the progress. The results imply that most popular sustainability measurements are indicators for sustainable energy development (ISED). There is a growing number of studies focusing on and applying country-specific methodologies. The measurement of M&A and sustainability performance faces difficulties in practice implementation due to a lack of availability of data, information, and databases, etc.

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Income inequality projects a different impact on economic growth as it can both stimulate and slow down economic growth. The stimulating effect of income inequality is revealed via saving. Specifically, wealthy social classes dispose the capability to save more and devote a larger portion of their saving to investments and technological developments. However, environmental and social perspectives shall be taken into consideration when aiming for a sustainable development. This paper considers the effects of income inequality on sustainable economic growth in the context of saving for the EU-25 countries during the period of 2005-2013. The empirical research of this study is done using open code software package Gretl and working with panel data. Based on the relationship between income inequality ratio, economic growth and GDP per capita, countries have been divided into 4 clusters. Empirical results support impact of reciprocal action among income inequality, savings, economic growth, spending on social security to domestic material consumption, renewable energy in gross final energy consumption, municipal waste generation, municipal waste recycling, ammonia and greenhouse gas emissions to be insignificant in all four country cluster groups. Reciprocal action among income inequality, savings, economic growth, and spending on social security was estimated to increase emission of sulfur dioxides and nitrogen oxides, but reduced the amount of gross domestic energy consumption. The reciprocal action is estimated to increase emission of nitrogen oxides in the country cluster groups with relatively low income level and different relationship between income and economic growth levels.

Research background: This study presents the results of the research which aimed to iden-tify and critically discuss existing methodologies in the merger and acquisition field. Value creation to merging and acquiring firms and national countries constitute the center of the research. This study distinguishes between specific methodologies employed to gauge M&A performance on a micro- (corporate) and macro- (economy and society) economic levels. The final section of the paper concludes with a theoretical methodological framework integrating methodologies employed to measure M&A performance on a firm level and methodologies measuring consequences and effects of M&A on the economy. The aim of the analysis described in the paper is to ascertain and evaluate theoretically existing methodologies used in empirical studies that would allow proper and critical understanding of the results of various findings in the holistic and global M&A area.Purpose of the article: The purpose of the paper is to investigate and critically discuss the methodologies employed within the M&A performance framework with the focus on specific anticipated outcomes of the M&A deal and methodology measuring this outcome. The following objectives are being raised: (1) To identify recent developments in the M&A market and determine challenges and changes they encompass; (2) To identify and critically discuss anticipated outcomes of the M&A deal and existing methodologies measuring M&A performance on the corporate level; (3) To identify and critically discuss anticipated outcomes of the M&A deal on the economy and methodologies measuring consequences and effects of M&As on the macro- economic level; (4) To integrate methodologies measuring M&As performance on a micro- and macro- eco-nomic levels into theoretical methodological framework enabling scholars and practitioners to evaluate M&A performance from a holistic perspective.Methods: Based on previous studies, the authors conduct a structured literature review aimed to critically discuss and evaluate developments and challenges of measuring M&A performance on corporate and macroeconomic levels. The research is carried out as a struc-tured assessment of past literature. The findings from scientific articles and studies by various scholars are being categorized, grouped and summarized to discern a meta‐analytic view of the work carried out to date. Finally, deep analysis of scientific literature, logical comparative analysis, systematization of scientific article and business cases are employed in the article.Findings & Value added: The paper evidences developments and challenges of measuring M&A performance on corporate and macroeconomic levels.  The re-search elaborates on several key developments in M&A methodology and performance studies carried out in empirical works during the last two decades. The findings help to independently and objec-tively assess performance of M&A from a holistic perspective.

Mergers and acquisitions (M&A) may serve as a catalyst in energy transition by accelerating this trend and “greenwashing” the deals. M&A are often used by large energy companies as a tool to explore potential synergy benefits. Recently, M&A strategies in the energy industry have been pursued to transform traditional business models into more “sustainable” models. On the one hand, it may be observed that companies are taking a proactive rather than reactive approach towards environmental-, social-, and governance (ESG)-related M&A deals. On the other hand, sustainable M&A deals do not interest activist shareholders and regulatory authorities only anymore. Inclusion of a sustainability framework and managing ESG-related risks have become part of the overall strategy of most companies within the energy industry. This research addresses the problem of how energy M&A are contributing to sustainable development on the one hand and reflecting sustainable developments on the other hand. The current research focuses on the systematic literature on the M&A deals in the energy industry through the lens of sustainability by applying the SALSA methodology. Further, we applied a SWOT analysis of M&A in the energy industry from the perspective of sustainable development. Thomson Reuters DataStream 5.1 database was used for developing a case study. A sample of Lithuanian, Latvian, and Estonian energy companies that were involved as acquirers or targets in the M&A events from 1995 to 2020 was developed. Establishing a methodological approach construed of SALSA, SWOT, and case study analyses allowed us to bridge a gap in the existing literature and provoke further discussion in regards to market developments through the lens of sustainable development. The research results showed that there are relatively few M&A of renewable companies as the M&A market is dominated by traditional energy companies within Baltic states. However, companies in the Baltic states are pursuing energy security, have set targets for emission reductions, renewables and energy efficiency, are supporting EU climate neutrality, and put great emphasis on climate change mitigation.

Mergers and acquisitions of companies are an important component of economic strategies and strategies of management of cross-border companies in changing global markets. This paper adds to the existing scientific literature by providing results of the research, which sought to compare value creation through mergers and acquisitions in the European Union. Performed research has 6 major implications. 1. Announcement of merger and acquisition transactions affects the price of shares of the acquiring company. Shareholders of the acquiring company experience a short-term increase in the value of their assets at the time of the announcement of a merger and acquisition transaction. 2. Return or loss of the price of shares of acquiring companies generated at the time of announcement of a merger and acquisition transaction may be explained not only by characteristics of the transaction or the company, but also by the attributes of the country of registration of the acquiring company. 3. Shareholders of the acquiring company experience a greater short-term increase in the value of their assets when a company, originating in a country, which acceded to the EU in 2004 and later, is acquired or merged. 4. Shareholders of the acquiring company experience a greater short-term increase in the value of their assets when merger and acquisition transactions are concluded in cross-border rather than domestic market. 5. Cultural and institutional differences between the host (inward) countries of origin generate the increase in the share price at the time of announcement of the transaction. 6. Shareholders of the acquiring company enjoy greater benefits in a common law country than shareholders of a firm of a civil law country.