Dunedin, the UK mid market buyout house, has invested in the £69 million management buyout of EV Offshore Limited (“EV”). The deal, directly originated by Dunedin, employed the firm’s trademark DebtBridgeTM solution, ensuring the certainty of delivery of all transaction funding at completion.
EV designs, manufactures and provides high performance, ruggedised video cameras that are used to diagnose and analyse problems in oil and gas wells. It offers a highly specialist service, providing skilled engineers to operate its cameras in the harshest of down-hole conditions. The high quality video and still images produced by EV’s cameras allow oil and gas well operators to quickly identify problems and design appropriate solutions. This rapid identification of problems saves operators many millions of dollars a year.
EV was founded by Technical Director, Jonathan Thursby, in 2000. Thursby successfully adapted video camera technology, which he had initially developed for use in televising automotive sports events. He created ground-breaking video techniques used by, amongst others, Formula 1™, the FIA World Rally Championship (WRC) and the BBC’s Top Gear series.
EV currently provides the only known down-hole cameras that can produce full colour high definition video images of the inside of an oil well and is therefore considered a global leader in its small but fast growing market niche.
EV is a fast growing business, having increased its turnover from £1m in 2010, to almost £20m in 2014. This represents a twenty-fold increase over four years and the Company is forecast to continue growing strongly. EV has a strong exporting record: it started to export just three years ago and some 85% of its revenues are currently generated overseas.
EV is based in Aberdeen and Norwich, with R&D and manufacturing facilities based in Norwich. It has a further presence in 17 worldwide locations across Northern Europe, Canada, USA, West Africa, the Middle East, Asia and Australasia. The business currently employs 100 staff. In 2014 EV received the Queen’s Award for Enterprise - International Trade, as well as winning the SPE Offshore Achievement Award in 2014.
Increasingly, EV’s cameras are being used in conjunction with other down-hole tools to allow operators to optimise production conditions in the well. The cameras can also be used to provide a video record when old wells are finally abandoned.
EV manufactures a range of down-hole video cameras which today represent over 14 years of product and software invention and innovation. Product features include an ability to operate consistently at pressures of up to 15,000 psi and temperatures of up to 175 degrees Centigrade. The Company has also developed the ability to transmit clear colour, high definition, video images from over 8.5 kilometres below the earth’s surface. These images can be viewed at the top of the well or streamed through the Internet to engineers sitting thousands of miles away in real time.
CEO, Francis Neill, commented on the investment:
“As a market leading technology company with a global presence, EV represents a strong UK success story. Lime Rock Partners’ backing over the last 4 years has enabled EV to grow by a factor of 20 and establish operations from Alaska to New Zealand. Moving forward, we are very excited to have Dunedin joining the team which will enable EV to further grow its business around the world and add EV to the list of the UK’s world class oilfield service companies.”
Dunedin partner, Dougal Bennett, who will join EV’s board, commented:
“This investment offers the opportunity to back an excellent management team in a fantastic UK business, which has a significant technological competitive edge operating in a predominantly untapped global market. We see a clear opportunity for the business to broaden its product and service offering and in turn deliver significant additional growth. This is highly representative of Dunedin’s approach to investment - backing UK based hidden champions and helping them to shine on an international stage.”
Oliver Bevan, an investment director at Dunedin who will also join EV’s board, added:
“EV Offshore has grown quickly over the last three years, fuelled by its world leading products and strong demand from a market beginning to understand the cost and operating benefits that EV can deliver. It has developed market leading down-hole video technology and is now poised to marry this with sensor tools to offer oil and gas well operators significant new capabilities for problem diagnosis and well production optimisation.”
This is the third investment that Dunedin has completed from its latest £300 million fund, Dunedin Buyout Fund III. It follows the £90 million management buyout of Kee Safety, a global supplier of safety systems and products.
EV’s management team is led by Francis Neill (CEO), Jonathan Thursby (CTO) and Sam Copeman (CFO). Leading the deal for Dunedin were Dougal Bennett (Partner), David Williams (Partner), Oliver Bevan (Investment Director) and Nicholas Hoare (Investment Director).
CMS Cameron McKenna – Legal
Calash – Commercial DD
EY – Financial and Tax DD
Simmons & Co – Corporate Finance
Intuitus – Technical and IT DD
Mills & Reeve – Legal
Evercore – Corporate Finance
PwC – Tax