EV portfolio: Company case study
Year of investment: 2014
What attracted EV Private Equity to the company?
EV Private Equity are dedicated to investing in innovative and disruptive technologies and services. This label sums up Fourphase’s value proposition. The company’s proprietary Solids Removal System helps the clients capitalize on increased oil and as production at a lower cost, a safe way of removing hazardous solids from the well stream while in parallel increasing the fields productivity.
What was EV’s role?
Originally EV Private Equity came in as a co-lead to another PE firm, but through the 2015-16 market downturn EV acquired their stake and has since then been positioned as the lead and controlling investor. Throughout the holding period EV has been and is continuing to offer substantial guidance on strategic direction plus coaching and augmentation of the FourPhase management team.
The EV Private Equity investment thesis was centred around the permanent use of the FourPhase offering to increase production – a novel and disruptive method that demanded substantial strategic business development with the conservative client base. EV has through its network assisted in making this happen and the company is now benefitting from several such long-term contracts both in the North Sea, in the Caspian and in Malaysia.
Some of the FourPhase reference projects performed stand out as remarkable testimonies of the value proposition. One such example would be a short-term trial with a North Sea operator awarded to test if the FourPhase technology could bring a sand filled well back
to live. Following the removal of several tons of wellbore solids this single well has produced 3500-4500 barrels of oil on a continuous basis through the FourPhase system for more than a year.
FourPhase has experienced a strong recovery from the recent oil crisis. In 2018 the company delivered strong EBITDA margins with both solid top line and margin growth continuing in 2019. The technology weighs very well in the current market and delivers
excellent EBITDA margins once at scale.
“ Fourphase delivered strong EBITDA margins with both solid top line and margin growth continuing in 2019.”
The latest strategic move is now to target the North American market and EV Private Equity is actively assisting with market introductions both in the onshore and the offshore segments. A first offshore Gulf of Mexico trail contract is already secured and an operational cooperation with a large onshore oilfield service provider, introduced by EV, is in the making.
EV is continuing to drive the application of the technology in new segments and technology advancement. Last but not least EV is working hard to ensure the company is strategically placed and exit ready.