Clearlake Capital Group, a US firm focused on special situations debt and equity investments in the lower mid-market, will pay $244 million to carve out an oil and gas-related rental equipment business from Archer Limited.
The all-cash transaction for Archer's 'Rental and Tubular' division is subject to regulatory approvals and other customary closing conditions and is expected to close next month, according to a statement.
Clearlake used its third fund, Clearlake Capital Partners III, a 2011-vintage, for the investment. In January the firm closed the vehicle on $785 million, above its hard-cap. That vehicle typically makes investments of between $50 million and $60 million — a slight increase from its $40 million average from previous funds.
The firm was unavailable to comment at press time.
The Rental and Tubular division provides equipment and services to exploration and production operators across the US, the Gulf of Mexico and both land and offshore markets in Mexico. The company’s main offerings are rental equipment, which provides drilling equipment, and tubing and tubular services for the oil sector.
In 2012, the division of Archer generated $100 million in revenue and $45 million of EBITDA. At the end of last year, the business had net assets of $244 million and a workforce of 250.
“These businesses are well-positioned to increase their market share and capitalise on continued growth in the North American oil and gas market. They represent a strong platform and we are eager to support their outstanding management team and invest to expand the business,” Feliciano said in a statement.
PEI's forthcoming issue features an in-depth interview with Clearlake co-founder Jose Feliciano.