Clough buys e2o for $14m
Clough says it has bought oil and gas technical services provider e2o for $14 million in cash and shares.
The company has been described as a provider of specialised commissioning, completions and hazardous area inspection services to the energy and resources sectors.
The purchase price includes a $9 million cash sum on settlement and an extra $5 million in cash and shares over three years subject to performance hurdles.
Clough said the acquisition was expected to be earnings per share accretive in the first full year of ownership.
The company is expected to deliver more than $5 million in EBIT in 3014 from forecast revenue of about $40 million.
e2o is already working on commissioning scopes for Chevron's Wheatstone LNG project, Origin's Australia Pacific LNG and Santos' Gladstone LNG projects.
Clough said e2o would continue to operate under its existing strong management team and brand to provide an integrated and independent commissioning service to clients.
"This will increase Clough's project service capabilities and enhance the company's range of services to operators in the energy and resources industry," Clough said in a statement.
"The Australian commissioning market has an excellent outlook with significant growth predicted in this sector in the next four years, as major LNG projects move from construction to operations."
Clough managing director Kevin Gallagher said the acquisition was in line with the company's growth strategy of becoming the pre-eminent commissioning contractor in Australia.
"e2o is one of Australia's leading commissioning contractors that has achieved and continues to achieve rapid growth," he said.
"The company provides access to a database of more than 2000 highly qualified personnel, providing the ability to quickly mobilise professional teams to suit project requirements.
"Through our acquisition of e2o Clough aims to provide clients with a seamless transition from construction to operations resulting in a flawless start-up of facilities and increased productivity."
e2o is based in South Australia but has offices in Perth, Brisbane, Gladstone and Singapore.
Clough shares were off half a cent to $1.09 at 7.50am.
