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3i makes 7.3 times money on €224m CH4 sale

3i, a London-listed private equity firm, has sold CH4 Energy, a UK oil and gas business it provided seed capital to in 2002, generating a 7.3 times money multiple and an IRR of 105%.

3i, a global private equity firm, has sold CH4 Energy, a UK energy and power company, to Venture Productions, a listed oil and gas producer, for €224 million ($285 million).
 
A spokesperson for 3i said that the firm generated a 7.3 times multiple on its original investment and an IRR of 105 percent. 3i provided an undisclosed amount of initial start-up capital for CH4 Energy in 2002 and has since backed five bolt-on acquisitions.
 
Based in London and Hoofddorp, near Amsterdam, CH4 Energy invests in fallow fields in the North Sea gas basin and specialises in the recovery and development of marginal oil and gas assets. 3i said that the firm has exploited the lack of interest in North Sea gas by the industry’s big players.
 
3i also previously held a stake in Venture Productions, having acquired a minority stake in the business in 1997. “3i was also a founding shareholder in Venture where we were pivotal to the early development of the business until its IPO in 2002,” said Colin Burnett, investment director with 3i’s oil, gas and power team.
 

Kingsbury: increasing 3i’s focus on gas and power

3i increased its focus on the midstream gas and power industry last November with the appointment of Shaun Kingsbury, a 15-year veteran of the sector, as industrialist in residence. The firm’s current oil and gas portfolio includes Vetco International, ABB’s former upstream oil and gas business; EDP, an oilfield development project manager; Epcon Offshore, a Norwegian designer and manufacturer of water treatment systems for the oil and gas industry; and Salamander Energy, an exploration and production company focused on South East Asia.
 
3i also completed the buyout of ABX Logistics, an international freight forwarder and logistics provider to the air, sea and road industries from the Belgian state railway SNCB. According to a report in French daily newspaper Le Soir, the transaction value was €80 million.