Enersol signs agreement to acquire a majority stake in NTS Amega

Enersol, a joint venture between ADNOC Drilling Company and Alpha Dhabi Holding, has agreed to acquire a 51% equity stake in NTS Amega (NTS) for a consideration of approximately US $58 million (excluding transaction fees, expenses and completion adjustment), making Enersol the majority equity holder.

In October 2023, Alpha Dhabi acquired a 51% equity stake in NTS, Enersol has now agreed to acquire the same 51% equity stake at the same valuation. The transaction completion remains subject to necessary regulatory approvals and closing adjustments, after which the NTS stake will be formally transferred to Enersol.

NTS Amega is a leading global provider of advanced manufacturing, complex tool repair and rental solutions for the oil and gas sector. Headquartered in the UAE, NTS has strategically located support hubs in hubs in the USA, Canada, KSA, Singapore, and Norway. NTS provides a range of solutions for technically challenging processes in the drilling industry to improve efficiency and reduce costs. This includes high tolerance manufacturing of complex rotary steerable heads, measuring/logging collars, carriers and accessories, drilling tools, topside, subsea, and process system components. These specialised repair processes are used to extend the life and availability of measuring while drilling, logging while drilling, non-magnetic drill collars, and other drilling accessories.

NTS has demonstrated strong financials in FY2023, reporting revenue exceeding $120 million, a robust EBITDA margin, and a free cash flow yield of over 10%. This presents Enersol’s shareholders with a significant value proposition that can be unlocked by NTS’s healthy profitability, attractive valuation multiples, and strong cashflow generation.

This marks the second acquisition announced by Enersol following its transaction to acquire a 67.2% controlling stake, subject to regulatory approvals, in Gordon Technologies, a leading provider of measurement while drilling (MWD) technology to the oil and gas industry. The acquisition of NTS is aligned with Enersol’s strategic vision to become an Oilfield Services technology-centric investment platform, where it is actively advancing plans to acquire and invest in multiple businesses to create a scalable technology ecosystem. The goal is to create a technology-powered platform that will enhance market value by providing greater access to GCC markets and improve operational efficiencies through the application of advanced technology to existing operations.

Moreover, this acquisition will be instrumental in providing scalable innovative technologies to Turnwell Industries, the recently established company focused on unlocking the UAE’s world-class unconventional energy resources through its support of innovative AI smart drilling design, completions engineering, and production solutions. A major driver of investment decisions will be the ability of those investments to support wider energy transition ambitions, a net-zero agenda and ongoing economic diversification efforts.