Bahraini investor in £145m swoop for Aberdeen oil firm Hydrasun

Equistone Partners Europe, which was spun out of Barclays in 2011, sold its controlling stake in the Aberdeen-based firm to Bahraini investment manager Investcorp, former owner of luxury goods brands Gucci and Tiffany & Co.

No value for the deal was disclosed, but Mohammed Al-Shroogi, president of Investcorp’s activities in the Gulf region, said: “The size of the transaction is between the $150m and $300m range.”

He added: “We look forward to supporting Hydrasun’s experienced management team as it continues to executive its strategy of expanding into new geographies.”

Hydrasun, founded in 1976, employs about 600 people across bases in

Aberdeen, Angola, Brazil, Kazakhstan and the Netherlands. It specialises in building hoses and undersea connectors for the oil and gas sector and counts the likes of BP and GE Oil & Gas among its customers.

The company, which paid an undisclosed sum for the hydraulics business of fellow Aberdeen firm ATR in 2009, has grown rapidly in recent years, with revenues rising from about £50m in 2008 to more than £105m for the current financial year.

Chief executive Bob Drummond said: “We believe this transaction will enable us to continue to grow organically and pursue strategic acquisitions to further accelerate our international footprint.

“None of this would have been possible without the very proactive involvement and support of Equistone.”

Equistone was formed in November 2011 when Barclays sold its private equity arm to the executive team led by managing partner Guillaume Jacqueau. The firm backed a £75.5m management buyout of Hydrasun in 2007 and said it had enjoyed a return of more than double its investment of about £40m.

UK managing director Rob Myers, who led the original deal, told The Scotsman that a number of trade and private equity buyers had made unsolicited approaches for Hydrasun last year and he was pleased to have backed its “high-calibre” management team.

He said: “It’s been a very successful investment and it’s rewarding to work with a team who can grow the business. The management want to take Hydrasun on to the next phase of its development and they have a financial partner who can support that.”

Investcorp has been broadening its horizons as financial markets recover from the twin blows of the Arab Spring uprisings and the global financial crisis.

Having focused in the past few years on deals in the Gulf region, the firm is increasingly buying stakes further afield. Last month it bought a majority stake in American IT security firm FishNet, plus a $120m portfolio of office properties across Chicago and Houston.

The acquisition of a controlling stake in Hydrasun marks the latest investment in the UK energy sector by investors from the Gulf region. In November, energy firm Taqa, three-quarters owned by the Abu Dhabi government, agreed to pay more than $1 billion for a stake in five BP oil fields.

Taqa announced at the weekend that it had struck oil at the new Darwin field, near its Cormorant assets, about 80 miles north-east of Shetland.