Waha Capital acquires stake in oilfield services firm Petronash for $88m

The manufacturing company, with offices in Dammam and India, has projected $200m in revenue this year

An oil pump operates in the Awali oil field in Bahrain on Wednesday, Jan. 5, 2011. Oil extended its biggest drop in seven weeks on signs that snowstorms in the U.S. curbed gasoline consumption in the world's biggest crude consumer. Photographer: Phil Weymouth/Bloomberg

Waha Capital, which counts Mubadala Investment Company among its shareholders, acquired a minority stake in oilfield services firm Petronash Holdings in a $88 million deal.

The transaction includes options to raise Waha Capital’s stake in the Dubai company to 50 per cent as well as for the establishment of research and development centres in the southern Indian city of Chennai and Dammam in Saudi Arabia. Waha Capital did not disclose the size of the minority stake that was bought in a statement on Monday.

The development would see expansion of the company’s service and product lines with a view to widen its customer base.

The deal would enable Waha Capital to make “focused direct investments in highly cash-generative companies in our areas of expertise, which include energy, technology and financial services,” Michael Raynes, the company’s chief executive said.

Petronash, which supplies engineering products for the oil sector, has projected $200m in revenue for this year. The company counts Saudi Aramco, Abu Dhabi National Oil Company, Kuwait Oil Company, Petroleum Development Oman as well as BP as some of its clients. The company said it had a “strong order book of current and future projects” with potential to expand further in the region.

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After consolidating its regional expansion, Petronash would look to focus on working in the hydrocarbons sector in Russia, North Africa and other regions, according to the company’s chairman U M Rao.

Petronash has plants manufacturing specialised oilfield equipment in Dubai, Houston and Dammam besides a centralised design, engineering and component-manufacturing hub in Chennai.

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