3i has sold its 36% stake in Reeves Oilfield Services Limited to Precision Holdings in a £92.4m transaction. The sale is conditional upon acceptance by 90% of Reeves’ shareholders, and if is approved then 3i will see a profit of £33m from an original investment of £5m.
Headquartered in Leicestershire, England, Reeves develops data logging tools used to provide oil and gas well-logging services to energy companies worldwide. It employs over 400 people.
Precision Holdings is a wholly-owned subsidiary of Precision Drilling Corporation, a Canadian and US-listed oilfield services company and will own 73.6% of shares in Reeves. It is headquartered in Calgary, Alberta, Canada with a turnover of almost £1bn.
3i backed the £9m MBO of Reeves from BPB plc in 1995, and was the only equity provider. The management and employees owned the remaining 64%. The investment was made from 3i Group’s own balance sheet.
Reeves’ turnover has increased from £20m in 1995 to £40m for 2003, with profits increasing six-fold.