Going to market
Latest regional player to go public seeks to expand
Posted: 29 January 2007
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Another of the region’s oil and gas industry service companies is going public. The United Arab Emirate’s Al Jaber Group is to make an initial public offering of its upstream process facilities business based in Dubai , GPS Group.
The offering – this month or March – on the Alternative Investment Market (AIM) of the London Stock Exchange is expected to put a value on the company of at least $150 million. AIM allows smaller companies to float shares under a more flexible regulatory system than the main London market.
 The GPS offering is expected to raise at least $55 million as the company seeks to purchase a fourth oil rig and expand its activities.
GPS chief executive officer Clint Elgar said last month: ``The next two or three years will probably be the busiest time for oil service companies in the past 20 years, because of the amount of projects already announced.'' He expects the company to operate six rigs by 2010, if demand remains strong.
GPS Group is forecast to almost double its revenue this year to $160-175 million, after sales of about $90 million in 2006.
Two of the company's offshore production units started operating in September and October in Malaysia and Indonesia . The service company expects to sign a contract for the third rig in the second-half of this year.
After the share sale, majority owner Abu Dhabi-based Al Jaber Group will own less than 50% of GPS Group, down from the current 80%. Elgar and partner Svein Riibe each currently hold 10% but this will dilute to around 5% each.
GPS produced $91 million in revenue last year, up from $62.7 million in 2005. Operating profit last year was $3 million, a turnaround from an operating loss of $275,000 in the previous year. Evolution Securities, GPS’s advisers on the share sale, are forecasting operating profits of $15 million in 2007.
Net income last year was $2 million, up from a loss of $500,000 in 2005, and Evolution is forecasting $9.5 million in net income for 2007.
GPS provides technology-based process facility solutions to the upstream oil and gas production and processing industry. Its principal businesses focus is on oil services from supply of modular process plant; turnkey design, procurement, engineering and construction; and commissioning and operation support.
GPS has a client base including Addax, Occidental, Shell, Fred Olsen, Petrofac, Petronas Carigali, Murphy Oil, Talisman, Nexen, DNO, SBM, Modec, Santos, Tanker Pacific, Premier Oil, Bergesen, NIOC, and OMV.
GPS has more than 450 international employees and operates from Dubai , Kuala Lumpur and Singapore , where the majority of FPSO construction takes place, and has fabrication facilities at Batam Island , Indonesia , and Mussafah docks, Abu Dhabi . GPS also has a sales presence in Houston , Calgary , Jakarta and Tehran .
Headquartered in Abu Dhabi , Al Jaber is a privately owned group of enterprises employing over 20,000 across the Middle East and North Africa .
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