BLOG - Houston – the annual pilgrimage to OTC

Jock Gardiner, Partner

Earlier in May I attended the annual Offshore Technology Conference (OTC) in Houston, Texas, my sixteenth consecutive trip to this important industry event.

Attending OTC is part of Maven’s ongoing strategy for keeping in touch with the technology and general developments in the energy service sector, which remains a key investment area for our business. OTC is a great barometer for the global state of the oil and gas industry and gives me a first-hand perspective on new investment opportunities, as well as the chance for some global talent spotting in a sector where knowledge of a wide pool of high calibre senior executives is vital.

Current levels of Merger & Acquisition activity in the energy sector are encouraging, with high oil prices and robust demand ensuring that there is a steady flow of new deal opportunities, with Maven having made seven new oil & gas service sector investments in the past year. It is the busiest time I can remember in nearly 20 years of investing in the energy service sector.

OTC provides a valuable opportunity for meetings with companies which could become potential new investments for Maven. In addition a number of Maven’s portfolio companies are typically represented, including MSIS, Flexlife, EFC Group, ROVOP, Deep Casing, Booth Welsh and Glacier Energy Services. All of these companies have global operations and many of them are actively developing new technologies, so this event is an excellent showcase for both Maven and our investee businesses.

This year I took the opportunity to meet with the executives of several larger Houston-headquartered oil service companies, as the buoyant state of the industry has these organisations showing an active interest in the performance of Maven’s portfolio of investments. OTC provides a useful forum for potential acquirers in the energy services sector, and for example the deal to sell Nessco to NASDAQ quoted US telecoms business Rignet Inc. was agreed during the 2012 event.

Maven’s long-term track record as a supportive private equity manager, which works in close partnership with investee companies to develop strategic growth plans, means that businesses visiting OTC are open to meetings to discuss their future prospects. A number of these meetings have led to Maven completing deals in a number of our current investee companies back in Aberdeen.

While there’s no doubt that it’s a great networking event, where we meet many of our long-established global contacts, OTC is above all a shop window for future investment, where we can meet people face to face and begin to assess whether their business will fit our investment criteria. I’m hopeful that on the back of a busy OTC 2014 week we’ve unearthed a few new opportunities and, given that the networking side of things is high on the agenda in Houston, I am pleased to say that I managed a game of golf in 85 degrees sunshine.

Maven’s Aberdeen-based energy service sector investment team focuses on investing in UK private companies, typically with an enterprise value of up to £25 million, in transactions requiring up to £10 million of private equity and mezzanine finance in the energy services sector.

We also manage the Scottish Loan Fund, which provides mezzanine finance to growing Scottish businesses. I am encouraged to note that SLF loans have already been provided to nine Scottish-headquartered energy service sector businesses, with for a focus on supporting technological developments and expanding global operations.

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