HitecVision exits MTEM
Stavanger, June 20th 2007:
HitecVision Private Equity AS announced today the sale of its portfolio company MTEM Ltd. (MEM), the front runner within next-generation electromagnetic mapping (EM) services for onshore and offshore oil and gas reservoirs, to Petroleum Geo-Services ASA (NYSE and OSE: PGS). PGS acquires MTEM for USD 275 million. HitecVision receives a cash consideration of USD 63.7 million for its share in MTEM, more than nine times the invested amount.
MTEM has developed a unique, breakthrough, cable-based EM technology with demonstrated, strong results in commercial operations. Unlike competing technologies MTEM’s solution can be used both on land and offshore, at any water depth, and provides real-time access of acquired data.
“When we and our co-investors made the initial investment in November 2004 which enabled the MTEM team to establish the company, we regarded the technology as revolutionary and potentially game-changing. Even so, the value creation in MTEM has surpassed our expectations. The first major break-through came in 2005 when the technology was commercialized for land-based operations. Another important milestone was reached earlier this year when the technology was successfully tested offshore. MTEM has now completed its first commercial offshore surveys, and PGS acquisition of the company confirms the quality of the MTEM team and the potential of the technology” says Ola Sætre, founding partner of HitecVision.
Since 2004 MTEM has grown from 3 to 67 employees, and has expanded its business to the United States and Canada. “We are proud that HitecVision again has proven its ability to take an investment from early phase to expansion stage. We primarily invest in more mature companies, but we have made exceptions for companies like MTEM, where we found the right management team combined with a unique technology and business model. MTEM has now reached the stage where rapid deployment of the technology can best be achieved by a large industry player, and we believe that MTEM has the best possible opportunitiy to become a world leader in the EM business as part of PGS”, states Sætre.
HitecVision records a money multiple of 9.2x and an IRR of 273% on the investment. This is the fourth exit of originally nine portfolio companies from the fund HitecVision Private Equity III, bringing total exit proceeds from the fund to about NOK 1.6 billion. Called-in capital from investors amount to NOK 469.5 million.
In addition to HitecVision, the shareholders of MTEM are Energy Ventures, Scottish Equity Partners, the University of Edinburgh, and company management and staff.