Oil Services Group Plots Giant Sale Bonanza
One of the biggest private equity casualties of the global financial crisis is drawing up plans to offload its biggest-remaining investment in a multibillion pound deal.
Sky News has learnt that Arle Capital Partners, which manages companies bought by Candover before 2009, is preparing to put Expro, an oilfield services giant, up for sale.
Insiders said on Monday that Arle and its fellow shareholders in Expro, the private equity arm of Goldman Sachs and Alpinvest, a fund manager, had appointed advisers from Goldman and Deutsche Bank to evaluate exit options.
A deal involving either a sale or stock market flotation could take place as soon as this year although Expro's investors have not set a formal timetable for selling the company.
Expro works with the world's biggest oil explorers to assist with production, often in difficult locations. It produced the first oil for Exxonmobil in Russia in 2005, and has grown through a string of acquisitions, including that of PowerWell Services in 2006.
Founded in Great Yarmouth in 1973, Expro is now based in Reading and is said to be worth at least £3 billion by analysts.
In results published recently for the six months to the end of September, Expro said it had made nearly $180 million (£108m) in adjusted operating profit during the period and insisted that it had excellent long-term growth prospects.
"As regards to the next six months, the Group remains cautiously optimistic and expects to see a continued improvement in performance, reflecting the continued strengthening in the international oil and gas sector and the benefits of our capital expenditure programme," Expro said.
"This anticipated near term improvement is, however, subject to the timing of significant offshore oil and gas developments, which in turn are subject to the decision making processes of both International and National Oil Companies."
Candover, Goldman and Alpinvest took Expro private in the summer of 2008 following a fierce £1.8bn bidding war with Halliburton, the US-based oil services group.
Expro is likely to be examined again by other industry players amid ongoing consolidation of the sector, with oilfield services firms' expertise sought after by big producers keen to squeeze more oil out of existing fields and to curb the decline in older ones.
Candover was one of the biggest names during the private equity boom which preceded the financial crash but made a series of poor investments. Arle was subsequently set up to manage the residual investments after it ceased to make new ones.
Among Arle's other holdings is Innovia, the banknote producer which was last month named the preferred producer of a new generation of polymer banknotes for the Bank of England.
Arle is in talks to sell Innovia to Pamplona Capital Management, another buyout firm. The currency provider is the final investment in Candover's 2001 fund to be sold.