A troubled Aberdeen-based oilfield service company yesterday announced the sale of two operations to raise £5.45million.
Sovereign Oilfield Group is selling Vertec Engineering and the cabin-rental fleet of Labtech Services.
The buyer of the two Granite City businesses is fellow Aberdeen firm Offshore Containers and the new owner said all 70 Vertec and Labtech staff would remain. Offshore Containers – which employs only 15 people – was formed in 2008 by private-equity groups Lansdowne Capital and Claver Capital as a vehicle to develop a leading worldwide rental business, focused on the needs of topside activities in the oil service sector.
Its initial moves included snapping up two specialist offshore-container rental and sales companies – Containental Offshore in Aberdeen and London-based Offshore Containers – for about £10million.
Lansdowne, Claver and the Royal Bank of Scotland have all committed to provide additional funding in support of the latest acquisitions.
Offshore Containers chief executive John Heiton said: “Vertec is already a market leader in its niche sector, with an established client base and unparalleled reputation for engineering and design excellence.
“In addition, the combination of the Labtech hire division with Vertec’s existing rental cabins positions us as one of the pre-eminent global providers of service cabins and workshop containers. We intend to build on this base and our aim is to invest and grow the rental fleet to 200 modules in the next few years in tandem with the ongoing expansion of our current offshore container business.”
Vertec managing director David Soper, who will continue in his role after the deal, added: “This move is a positive one for the company and paves the way for future business and market growth.”
Cooltime Engineering Services, a subsidiary of Vertec, was not included in yesterday’s disposals. Sovereign said all sale proceeds would be used to pay down debts.
It added that the disposals were a condition of continued banking support from the lender group of HBOS, Merrill Lynch, Cyrus Partners and Polygon Investment Partners, with which it has debt agreements of £32.8million.
Sovereign added that the group’s drilling division and remaining fabrication operations would be its trading businesses. For the year to the end of March 2008, the unaudited turnover attributable to these was £87million with gross profits of £21.3million before allocation of administration costs.
Last September, Sovereign said trading in its shares had been suspended because it was unable to publish its annual report and accounts for the year to March 31 by September 30.
The company’s latest results are now to be published on Friday and shares will then be restored to trading.