Waha Capital sells stake in NPS Holdings

Investment firm to get shares in new publicly-traded oilfield services platform

Waha Capital chief executive Salem Al Noaimi. Delores Johnson / The National

Waha Capital, an Abu Dhabi-based investment firm in which Mubadala Investment Company has a 15 per cent stake, has agreed to sell its stake in UAE-based NPS Holdings to National Energy Services Reunited (NESR) of the US in a cash and shares transaction.

NESR, a special-purpose acquisition company that targets investments in the energy sector, announced a deal on Sunday to acquire NPS and Oman-based Gulf Energy for a combined value of US$1.1 billion, to create the first listed oilfield services firm in the Mena region.

Waha will receive around Dh251 million in cash and 5.5 million shares in NESR, issued at an initial value of $10, per share and representing an interest of approximately 6.2 per cent in the company. Waha will take one seat on NESR’s board. The deal is expected to close in the first quarter of 2018.

“This transaction delivers an impressive return on Waha Capital’s original investment and is transformational for NESR, in which we now hold a significant stake,” said Salem Al Noaimi, Waha’s chief executive and managing director.

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“With this transaction, NESR will become a leader in oilfield services in the Mena region, and is in a prime position to take advantage of new opportunities as investment in hydrocarbons increases again. Scale, expertise and access to capital markets will be important as the company expands in the coming years.”

Waha Capital acquired its stake in NPS in June 2014 for Dh279m, as part of a consortium including Fajr Capital and the  Arab Petroleum Investments Corporation (Apicorp). The stake was carried on the company’s balance sheet at a value of Dh288.7m as at the end of the third quarter of 2017.

“We formed NESR to invest in the oilfield services sector globally, and this transaction represents the first step in that strategy,” said Sherif Foda, NESR’s chief executive and chairman.

“With the support of our esteemed customers, we want to create a truly national services company which has its roots in the region. I am grateful to Waha Capital and their leadership for their confidence in NESR and look forward to working together to realise our exciting vision.”