A small Aberdeen energy firm has been bought by a US oil service giant in a deal believed to be worth up to £20million. Energy Ventures – a venture capital firm dedicated to funding energy companies – has completed the sale of Intelligent Well Controls (IWC) to Halliburton, marking the firm’s 13th exit.
The company first invested in IWC in January 2012 as part of its fourth fund.
Headquartered in Aberdeen, IWC designs, develops and manufactures real-time surveying equipment based on measurement-while-drilling (MWD) technology for the oil and gas industry.
Greg Herrera, Aberdeen-based partner of Energy Ventures, said: “Our investment in IWC was based on the potential we saw in the company, its people and its products.
“The purchase by Halliburton represents an important step in the development and expansion of IWC.”
The acquisition is the latest stage in the evolution of the Energy Ventures portfolio, consisting of 25 companies and £458million of committed capital raised to date.
Mr Herrera added: “From an Energy Ventures perspective, the IWC sale is a successful exit and one which underlines our commitment to identifying and supporting companies with a marketable technology which has the ability to provide solutions to long-term oilfield challenges.”
Martin Ewan, a partner and acquisition expert at legal firm Pinsent Masons in Aberdeen, said he was not surprised to see Halliburton buy the company.
“Oil and gas industry service companies are particularly attractive propositions for venture capital funds and private equity investors as this particular deal demonstrates,” he said.
“Sir Ian Wood’s interim report on the future of the UK oil and gas industry emphasised the need to enhance hydrocarbon recoveries to prolong the life cycle of the UKCS. The key to unlocking those harder-to-get reserves is in smart technology and hi-tech firms like Intelligent Well Controls will play a crucial role in this field.
“It’s no surprise IWC have caught the attention of Halliburton but on a wider note it’s important that the industry continues to support and invest in research and development companies, especially in the early start-up period where funding can be hard to come by.”
Halliburton bought another Energy Ventures firm – Red Spider – in 2012.