Arcapita, the European private equity arm of Bahrain-based Arcapita Bank, has led the acquisition of a 100% interest in Roxar, a Norwegian provider of technology services and equipment to the oil and gas industry. The total transaction value is approximately US$200m (€168m).
The principal vendors in the deal are Lime Rock Partners, a US private equity firm, which previously owned 51% and Smedvig, a Norwegian offshore drilling contractor, which controlled a 43% stake.
The Roxar transaction brings to 51 the total number of corporate, real-estate and asset-based investments made by the Bahrain-based group, which has spent more than US$10.7bn in the last seven years.
Unlike most private equity firms, Arcapita’s investments are not channelled through the limited partnership funding structure. Instead, high net-worth individuals contribute to investments on a deal-by-deal basis.
This structure is unlikely to change, according to a spokesperson at Arcapita Bank, who said: “Many of our investors are businessmen, who prefer to be able to pick and chose out of the acquisitions that we make.”
Arcapita has about 1,200 high net worth individuals supporting its investments. The company itself employs a team of about 172 staff, of which 120 are based in the Gulf region, with 25 in London and a further 35 in Atlanta.
Another defining feature of the group’s investments is that they comply with Sharia law, so the group will not make investments involving pornography, alcohol, pork or interest payments. Apparently, these limitations do not affect deal flow unduly – for the year 2005, Arcapita announced that it had achieved a record net income of US$104.3m, representing an increase of 48% from the US$70.5m achieved in 2004.