EQUISTONE, the private equity group, yesterday exited its majority stake in oil and gas company Hydrasun after selling it to a Bahraini-listed investment company.
The sale, which comes over five years after Equistone backed a management buyout of the firm, represents more than a 2.5x premium to the firm’s original money investment of £38m. The firm was valued at around £75m at the time of the deal.
It is understood the buyer of the stake, listed alternative investment manager Investcorp, paid an enterprise value of around £145m to take on the company, which is based in Aberdeen and started life in 1976 servicing offshore oil rigs in the North Sea.
Equistone held Hydrasun – whose performance is closely aligned to oil prices – over a period when oil spiked to $140 in 2008 before falling to $35 in the first part of 2009. The firm grew revenues over the period from £50m to £105m
Rob Myers, Equistone UK managing director, told City A.M.: “The biggest decision we made was to back the management team. We made a decision in 2009 to relocate business premises and we started hiring a number of key executives to grow the business.
“When the market was hard we spent a lot of time investing in the business.”
Yesterday’s deal is the first sale by Equistone, which was spun out of Barclays in 2011, since it closed its fourth buyout fund last month after raising €1.5bn (£970m).