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22 Apr 2009 07:00
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For Immediate Release |
22Β AprilΒ 2009 |
Hunting PLC
Acquisition
Hunting acquires NCC a leader in subsea coupling technology for US$55million
HuntingΒ PLCΒ (LSE: HTG), the international energy services company today announcesΒ theΒ acquisition of National Coupling CompanyΒ Inc.Β ("NCC"), a leading developer and manufacturer of subseaΒ hydraulicΒ equipment,Β for a cash consideration of US$55 million.
TheΒ considerationΒ of US$55m is payable in cash on completion with an additionalΒ US$5mΒ to be paid afterΒ one year providedΒ thatΒ certain financial performanceΒ targets areΒ achieved.Β Β The acquisition isΒ conditional onΒ the completion of environmental testing at NCC'sΒ Houston,Β Texas,Β facility which is expected toΒ beΒ completedΒ by the end of AprilΒ 2009.Β Β It is expected the acquisition will be earnings enhancing in 2009.
NCCΒ was founded in 1968 andΒ is the worldwide leader in subsea hydraulic coupling technology. ItsΒ product linesΒ areΒ focused onΒ critical subsea hydraulic couplings that require a metal seal for ultra deepwater,Β extreme high pressureΒ andΒ high temperature applicationsΒ up toΒ 22,500 psi and 400Β°F. NCC wasΒ aΒ privately owned company with the majority of shares held by the family ofΒ theΒ founding owner. None of the majority owners will be involved in the company going forward.
NCCΒ recentlyΒ developed two new subsea product linesΒ whichΒ haveΒ expandedΒ its operating and financial profile:
ChemicalΒ InjectionΒ System is a positive displacement metering system that delivers multiple chemicals for subsea applications with the highest degree of precision and efficiency.
Special hydraulic valvesΒ are designed toΒ meet the industry's highest standards of specifications for subsea and surface applications.
NCCΒ has 68Β USΒ patents with over 300Β USΒ and international patents,Β 11Β patents pending and six trademarks. The company has over 100 employees located in modern, well equipped premisesΒ headed by a highly qualified management team with an extensive engineering background.
NCC's 2008 normalisedΒ profits before taxΒ wereΒ US$4.6mΒ withΒ an EBITDA of US$6.5m. These are afterΒ adjusting forΒ non-recurringΒ itemsΒ of US$3.1m. The net assets and gross assets of NCC at 31 December 2008 were US$15.6m and US$20.8m respectively.
The manufacturing techniques employed by NCC will enhance Hunting's existing facilities. Over the last three years,Β NCCΒ has averagedΒ R&DΒ spendΒ in excess of US$2m, primarily for theΒ SubseaΒ ChemicalΒ InjectionΒ System.
The acquisition of NCC marks aΒ step change in Hunting'sΒ presence in the target market of high pressure deep water drilling.Β Β In the past five years, approximately US$46 billion has been spentΒ globallyΒ on subsea equipment,Β drilling and completion. It is forecast that US$80 billion will be spentΒ overΒ the next five years by the industryΒ withΒ participants includingΒ Petrobras, Shell, Total, Chevron, BP, Exxon and Statoil. These projects areΒ lessΒ likely to beΒ subject toΒ delay or cancellationΒ given that subseaΒ exploration and productionΒ is expected to continue to enable the replacement ofΒ reserves andΒ theΒ growthΒ inΒ productionΒ for international oil companies.
Commenting on theΒ acquisition, Dennis Proctor Chief Executive Officer of Hunting said:
"The acquisition of NCC marks a significant and strategicΒ advanceΒ in our Company's participation in the deepwater programs of the future. Further, it complements our strategy of market share leadership, proprietary technology, global footprint and synergies within existing product lines.
"As outlined at our Final Results, Hunting has identified a number of acquisition opportunities,Β ofΒ which NCC forms the first step. We lookΒ forward toΒ makingΒ furtherΒ strategic acquisitions which enhance our capabilities."
For further information please contact:
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Hunting PLC Dennis Proctor, Chief Executive Peter Rose, Finance Director |
Tel: 020 7321 0123 |
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Buchanan Communications Ben Willey Richard Darby |
Tel: 020 7466 5000 |
Notes to Editors:
About HuntingΒ PLC
HuntingΒ PLCΒ is an international energy services provider to the world's leadingΒ upstreamΒ oil and gas companies. Established in 1874, it is a fully listed public company traded on the London Stock Exchange. The Company maintains a corporate office inΒ HoustonΒ and is headquartered inΒ London. As well as theΒ United Kingdom, the Company has principal operations inΒ Canada,Β China,Β France,Β Holland,Β Hong Kong,Β Singapore,Β United Arab EmiratesΒ and theΒ United States of America.
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