Energy investor Parkmead is to acquire Aberdeen University spin-out oil and gas consultancy Aupec in a deal worth more than £4million.
It is being bought from its shareholders, who acquired 80% of the business from the university in 2000 and last year bought Aberdeen’s remaining 20% stake.
The acquisition will be made in a cash-and-shares deal involving the issue of 235.3million new Parkmead shares and with £1million in cash going to the Aupec shareholders.
Parkmead shares closed last night at 1.3p.
Directors and shareholders of Aupec include its founder, Professor Alex Kemp, of Aberdeen University, co-founder David Rose; Dana Petroleum chief executive Tom Cross, who is chairman, and his wife, Linda. Mr Cross is also a non-executive director of Parkmead. Mr and Mrs Cross have the lion’s share of Aupec, with a combined 66.2% holding. After the deal they will hold 28.12% of Parkmead.
Also on the board of Aupec are managing director Donald Mackay and economics director David Reading, who both have shares.
The new shares to be issued will represent 38.98% of the enlarged share capital of London-based and Aim-listed Parkmead.
Aupec is a recognised global authority in energy-sector economics, valuation and benchmarking and has been providing economic consultancy services to the oil and gas sector since 1986. It was originally known as Aberdeen University Petroleum and Economic Consultants.
Its accounts for 2008 show turnover and net profits of £2.71million and £639,000 respectively. As at December 31 Aupec had net assets of £1.34million and no debt.
At December 31, Parkmead had £7.24million of net assets including £3.85million cash and no debt.
Parkmead chief executive Niall Doran said: “The acquisition of Aupec is an important step in fulfilling the company’s strategy to become a leading small cap oil and gas investment and advisory house.
“The combination gives us a stronger platform and more diverse base upon which to build Parkmead’s revenues and income. It further strengthens the high-level financial, government, major energy company and technical relationships that we have in the oil and gas industry and comes at a time when demand for energy advisory and consultancy services has increased.”
Aupec, which is based at Aberdeen Science and Technology Park, employs 17 staff directly and at any one time has about the same number of consultants.