Since the new year, there has been a rush of companies filing to go public to take advantage of rising stock prices.
In Houston, two companies filed on Friday. Not surprisingly, given the recent rise in the price of oil, they are both oilfield service companies
The first is Cactus Inc, a PE-backed manufacturer of onshore wellheads and control equipment. It has its head office in the Memorial City area of west Houston. It has 13 service centers around the US, one in Australia, and two manufacturing facilities in Louisiana and China.
The company was formed in 2011 by two brothers, Scott and Joel Bender, with the backing of Cadent Energy Partners. The brothers had previously started Ingram Cactus, which was sold to Cameron (since acquired by Schlumberger) in 1996 for $100 million. After that, they worked for the Wood Group until the pressure control division was acquired by GE in 2011. The CFO of Cactus is Brian Small, who was also the CFO at Wood Group Pressure Control.
For the nine months ended 30 September it had revenues of $236 million. Its revenues are accelerating as it did $96 million in the three months to September. Adjusted EBITDA for the nine months was $77 million (32.6%).
The underwriters are Citigroup, Credit Suisse and Simmonds & Co. PwC are the auditors, Baker Botts are the legal advisers to the company.
No details yet of the size and price of the proposed offering.
The second company to file is Ipsco Tubulars, a producer of tubular drill pipe, casing and tubing for onshore exploration and production. The company has its head office in NW Houston.
It is being spun off from its parent, PAO TMK, a Russian company that has a quote on the London Stock Exchange. The parent company intends to keep a controlling stake. TMK bought the assets of IPSCO for $1.7 billion through a two-part transaction in 2008 and 2009.
For the nine months ended 30 September, 2017 the company had revenues of $734 million and adjusted EBITDA of $62 million.
The CEO of the company is Piotr Galitzine. He has been Chairman of the Board since 2008 and has held senior positions with Mannesmann and BASF. Not mentioned in the filing is the fact that he is a descendant of Russian czars and his wife is an Austrian princess!
The CFO is Evgeny Makarov. He has been the CFO since August 2013 and prior to that worked in the finance department of TMK in Moscow for many years. Interestingly he is married to Elena Verbinskaya, who will be Ipso’s VP of Accounting Integration and Financial Reporting. She will also maintain her position as Chief Accounting Officer at TMK. Not sure how that’s going to work out!
Merrill Lynch and Morgan Stanley are the lead underwriters. Ernst & Young are the auditors, Latham & Watkins are the legal advisers.
As with Cactus, no details of the size of the offering were disclosed.