Reservoir Group Powers Ahead With Third Deal In Ten Months
Fast-rising UK business, Reservoir Group, has completed its third deal since forming from a management buy-out of an Aberdeenshire-based company last May.
The group, which aims to become a global leader in integrated downhole drilling products and services to the oil and gas industry, has acquired Aberdeen-based Omega Data Services Limited.
The company specialises in the design, manufacture and supply of downhole memory tools and gauges for pressure and temperature surveys, which reduce costs for production logging and data gathering.
With 12 employees and a turnover of $6 million, Omega Data Services has a wide client portfolio of oil and gas operating and service companies around the world.
Reservoir Group, which acquired Corpro last year in a deal valued at over £20 million, is backed by Houston and Aberdeen based private equity firm, SCF Partners. Through organic growth and further acquisitions of niche, independent market-leading companies, Reservoir Group is seeking to become recognised as an internationally-focused market leader that offers integrated, specialist services to the down-hole drilling, completion and production sectors.
Corpro, and recently acquired Dowdco, form the basis of the group's activities in drilling downhole tools and services. Both these companies specialise in drill coring services and the manufacture of coring tools and drill bits.
The addition of Omega Data Services marks the Group's first step into completion and production tools and services.
Pascal Bartette, chief executive officer of Reservoir Group said: "Together these two distinct areas will allow us to provide a much broader spectrum of services than the oil and gas industry currently has available to it. Equally, they spread the risk for the group in that while drilling is very cyclical, production and stimulation activity is far less affected by oil price.
"Omega has broken new ground in the UK and secured a significant share of a highly competitive market. Omega's success is based on its reputation for getting new, high quality, cost effective products to market quickly. The primary design criteria for all Omega products is that they allow operators to get the best data from their wells and can be safely and successfully operated by field personnel with no specialised training or knowledge.
"As part of the Reservoir Group, we anticipate Omega will be able to quickly replicate its performance in other oil and gas provinces through our international network."
Omega Data Services' management team and staff will all remain under the Reservoir Group banner to lead the international expansion of the company.
Neil Matheson, managing director of Omega added: "I am pleased that this deal gives Omega the platform for more rapid international growth through the Reservoir Group's established network and provides the existing staff with new career opportunities within a dynamic emerging global market leader. Omega's experience with high temperature downhole electronics will also bring new openings for the other companies within the Reservoir Group."
Reservoir Group is committed to further acquisitions and is targeting independent market leaders within specialist sectors that provide good product differentiation.
"We are building a critical mass that will improve our global reach and generate synergies within the group allowing our companies to realise their full growth potential more quickly and effectively, while capitalising on the complementary aspects of each." added Mr Bartette.
The RBS Structured Finance team in Aberdeen provided senior acquisition facilities in support of the deal. John Heiton, director of structured finance at RBS in Aberdeen, said: "This latest transaction extends what has already proved to be an excellent working relationship between RBS and Reservoir Group. Omega is another ideal fit for the Group, adding new and complementary capabilities to its offering, with the opportunity for future revenue synergies and international growth. We've worked with SCF Partners on more than 10 transactions now and have been consistently impressed by their ability to successfully implement buy-and-build strategies."
Advisers to Reservoir Group included Maclay Murray Spens and PwC while Simmons & Co and Deloitte assisted Omega Data Services in this transaction.