Technical consultancy AqualisBraemar is building its global footprint by buying 100% of rival LOC Group.
The move means the Oslo-listed offshore, shipping and oil and gas group, which was spun off by UK shipbroker Braemar Shipping Services earlier this year, will now operate in 39 countries. That is up from a pervious footprint in 33 countries.
AqualisBraemar chief executive David Wells said: "Our strategy is clear; we want to leverage on our position within the shipping industry to support the global energy transition."
He added that LOC Group has a strong and highly complementary business.
The sellers included European investment group Bridgepoint and key employees of LOC.
AqualisBraemar is paying $20.2m in cash. The company will carry out a private placement of 22m new shares to raise $15m to help pay for the deal.
The two companies will be trading separately for up to six months following completion of the transaction.
LOC, founded in 1979, is an international marine and engineering consulting firm that operates under four brand names: LOC, Innosea, design arm Longitude and JLA (John LeBourhis).
The group provides loss prevention and loss management services, as well as marine and engineering consultancy services.
"The consulting space within the shipping industry is ripe for consolidation. Our customers' needs are rapidly evolving and we believe our joint increased scale and wider global footprint will help us cater for those requirements," said RV Ahilan, chief executive of LOC.
The combined operation will have 880 staff in 85 offices.
"Our complementary geographical footprint reiterates how this acquisition will allow us to provide clients in the shipping industry with even better local expertise and swifter response times regardless of where in the world they are," added Wells.
AqualisBraemar has a strong position in hull and machinery surveys, while LOC is a leading player within protection and indemnity.
"We are combining two well-run businesses to create an even more complete service provider. You would have to look very, very hard to find a better strategic fit than AqualisBraemar and LOC Group," said Wells.
CEO staying on
Ahilan will continue with the joint company in a newly created role as chief energy transition officer.
The idea is to have 50% of revenue coming from renewables and other sustainability and CO2-reducing activities by 2025.
In March, LOC unveiled a new digital product that aims to assist signatories to the Poseidon Principles assess the carbon performance of ships.
The goal is to provide data that will allow shipping banks to align their investment portfolios with the environmental targets set out in the Poseidon Principles. The data can also be used to help banks make investment decisions.
The Poseidon Principles is an effort agreed by leading ship finance banks to incentivise low-carbon shipping.
LOC is to establish a new company — LOC Digital — to run the new platform, which will be called Triton.
The technical consultancy sector has seen big changes in the last couple of years, in addition to private equity firm Aqualis buying the former Braemar Technical Services.
TMC Marine was taken over by French classification society Bureau Veritas and Brookes Bell by insurance services company Thomas Miller.
