GR Engineering Acquires Leading Oil and Gas Services Business

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GR Engineering Services Limited (ASX:GNG) (GR Engineering) is pleased to announce that it has entered into an agreement to acquire Production Solutions, a leading independent provider of specialist operations & maintenance and well management services to the oil and gas sector across Australia and South East Asia.

GR Engineering will purchase Production Solutions from certain Australian and Malaysian subsidiaries of Oceaneering International, Inc. (Oceaneering) for $5.75m. Oceaneering is a global provider of engineered services and products, primarily to the offshore oil and gas industry, with a focus on deepwater. Production Solutions was acquired by Oceaneering as part of its acquisition of AGR Field Operations in 2011, and its origins date back to 1997.

The acquisition marks GR Engineering’s entry into the oil and gas services sector. Once complete, Production Solutions will continue to operate as an independent oil and gas services business unit of GR Engineering. Importantly, Production Solutions’ strong management team intend to continue in their roles to service the business’ high quality clients and achieve growth with GR Engineering’s support.  


  • Purchase price of $5.75m to be funded from GR Engineering’s existing cash reserves – strong balance sheet preserved
  • Immediately EPS accretive
  • GR Engineering expects Production Solutions to deliver revenue of approximately $36m and EBITDA of around $2.4m in CY2014
  • Proven, well regarded business with attractive growth opportunities
  • Provides diversification from mining and mineral processing activities with attractive exposure to oil & gas from predominately the commissioning phase onwards
  • Strategically positioned across Australia with offices in Melbourne, Perth and Brisbane with South East Asian growth platform
  • Leading independent registered operator servicing Australia’s oil & gas sector (both onshore and offshore)
  • Long term client relationships
  • Strong growth potential through coal seam gas (CSG) / LNG exposure
  • Strong safety record and culture across skilled workforce of around 100 personnel
  • Leading management team committed to growing the business
  • Long term ‘schedule of rates’ contract profiles with strong earnings visibility
  • Strong order book with pipeline of near term opportunities identified and being progressed

Productions Solutions is headquartered in Melbourne with additional offices in Perth, Brisbane and Kuala Lumpur, Malaysia.

Productions Solutions operates two integrated business divisions: Operations & Maintenance and Well Management.

Currently, around 90% of revenue is generated from Production Solutions’ Australian operations, with South East Asian operations serviced through Malaysia considered to have growth potential. 

GR Engineering Managing Director, Mr Geoff Jones said Production Solutions represents a well considered and logical opportunity for GR Engineering by providing a strategic entry into the oil and gas services sector via a proven business with a strong management team capable of taking advantage of numerous growth opportunities.  

“We are very pleased to be acquiring Production Solutions. GR Engineering has sought an acquisition opportunity that enables it to diversify its sector exposure whilst preserving the group’s technical base and maintaining its strong balance sheet. After carefully considering the acquisition of Production Solutions we believe it represents an excellent and logical opportunity for GR Engineering to achieve these objectives and gain attractive exposure to the growing oil and gas services market.

Whilst the acquisition expands GR Engineering’s operating profile, it will also enable us to remain focused on our core business of providing leading services to the resources and mineral processing industry.

We are pleased the high calibre Productions Solutions management team are looking forward to becoming a part of the GR Engineering group and we share their enthusiasm about growing the business through the provision of high quality service for clients.”

Productions Solutions General Manager, Mr Joe Corvetti, intends to continue in his role and said he was excited to lead an independent business whilst becoming a part of the GR Engineering group.

“We look forward to becoming a part of the GR Engineering group which has an outstanding track record of high quality service and safety. We believe this is a key cultural ingredient shared between both groups that will provide a strong platform for continued success.

As an independent business unit of GR Engineering, Production Solutions will still be able to provide its clients the same high quality service, while realising the benefits of being part of a strong group with close Board and senior management interaction and support.

We see numerous opportunities for Production Solutions to secure more work and to build upon our strong pipeline with GR Engineering’s support.”

The acquisition remains subject to the satisfaction of a number of conditions precedent customary for an agreement of this nature. It is anticipated that the acquisition will be completed in February 2014.

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