Abu Dhabi-based private equity firm Gulf Capital plans to sell its remaining stake in Gulf Marine Services within two years in the open market and expects to make a total profit of about 10 times its original investment, or around $600 million.
Gulf Capital floated approximately 40 per cent of its holding in the vessel operator on the London Stock Exchange earlier this month and plans to sell its remaining 49.7 per cent stake in the coming two years, chief executive Karim El Solh said on Tuesday.
That could give a boost to a Middle East private equity market which has been almost frozen since the global crisis hit in 2009.
“We’ve made almost 10 times our money on this investment. That’s more than the size of the whole Equity Partners Fund,” El Solh said from his office in Abu Dhabi, referring to a $533 million Gulf Capital fund which is almost 80 per cent invested over eight deals across the Gulf region.
“We’ve diluted 40 per cent of our stake and will plan to sell the rest in the open market within the coming two years. The London Exchange is very liquid and will enable us to fully exit our investment smoothly,” he said.
Gulf Capital bought an 80 per cent stake in Gulf Marine Services (GMS) through its GC Equity Partners II Fund in 2007, and grew the company from a UAE-based oil and gas services firm into one with operations across the Gulf region, as well as in the Middle East and Europe’s North Sea.
GMS operates self-propelled, self-elevated support vessel fleets for clients in the oil and gas sector.
Gulf Capital paid close to $60 million for its original stake according to Reuters calculations.
The initial public offering (IPO), completed last week, valued GMS at 472 million pounds ($783 million) at the offer price of 135 pence and total proceeds raised in the IPO were 179 million pounds, after exercise of the over-allotment option.