Hunting, the international energy services company, said yesterday it was focused on four acquisitions – one with operations in Aberdeen – and was confident deals could be concluded within two months.
The company, which has a significant war chest following the sale of Canadian subsidiary Gibson Energy, said the deals would in total be worth about £94million. It said the targets were a proprietary products manufacturing company in the US with about 300 patents worldwide, a steel-processing company in the US, an intervention and rental products business with operations in the Middle East and Aberdeen, and a manufacturer in Indonesia.
Hunting chief executive Dennis Proctor said the acquisitions would add around 400 people to the company’s existing global workforce of 1,500 – about 280 of whom work at a tubulars business at Portlethen, near Aberdeen, at the Hunting Cromar wireline and pressure control business in Aberdeen and at a tubulars operation in Montrose.
Mr Proctor said he was bound by confidentiality agreements not to disclose the names of the companies targeted, but discussions were well advanced and due diligence was being carried out on all four, with the acquisitions expected to be earnings-enhancing from the start.
Hunting said yesterday the disposal of Gibson Energy, which owns and operates oil distribution terminals, pipelines and storage depots in North America, was completed in December for £517million. The buyers were private equity firms Riverstone and Carlyle. The proceeds have been used so far to eliminate Hunting’s net borrowings.
Mr Proctor, speaking as Hunting released results for the year to December 31, said: “2008 was another year of good growth in our core Hunting Energy Services operations.
“With the successful completion of the Gibson disposal, we will deploy this significant capital to acquiring complementary businesses which will be earnings enhancing for our shareholders.
“The global economic environment is now impacting the energy industry and, although Hunting is exceptionally well placed to weather this turbulence, our short-term focus is on cash containment, investment in more efficient plants and introducing new products to customers.”
Hunting said that, in the short term, most of its continuing operations order books remained strong but it would be affected by the reduction in capital expenditure budgets announced by several major industry customers.
The company yesterday posted pre-tax profits for 2008 from continuing operations of £58.9million, up from profits of £47.3million the year before. Revenues from continuing operations increased to £440million from £398.7million the previous year.
Hunting also said it had net cash of £372.3million at the year-end following the elimination of borrowings.