South African valves company Control Valve Technology (CVT), which provides servicing, refurbishment and sale of control and safety valves used in the energy, mining and petrochemical industries, was last month acquired by oil and gas engineering specialist EnerMech as a going concern.

The deal forms part of EnerMech’s expansion into the African oil and gas sector and follows an earlier acquisition of South African cranes and load testing business Water Weights International South Africa (SA) in 2012.

The EnerMech Group acquired 100% of the shares in Water Weights International SA, which represents the Western Cape, Eastern Cape and Namibia regions of the Water Weights licence, and the local name of the Water Weights International SA company was changed to EnerMech Water Weights SA.

The CVT acquisition of business and staff is part of a three-year, £20-million investment programme to establish a strong infrastructure in Africa, which has to date, established a presence in Nigeria, Ghana and Angola, a trading entity in Mozambique, and opened new regional headquarters and workshop facilities close to Cape Town’s main container terminal in Paarden Eiland.

UK-headquartered EnerMech provides a range of mechanical engineering services to the international energy industry, employs more than 2 000 staff across 30 locations and expects 2014 revenues to exceed R 4.9-billion.

CVT has a number of long-term customer relationships across a broad range of industries and has successfully executed projects in South Africa, Angola, Nigeria, Ghana and the Middle East.

CVT’s strong client relationships would provide EnerMech with quick and efficient market entry in Africa for its valves division, which is one of seven business lines supplied to the energy industry, states EnerMech CEO Doug Duguid.

“CVT is a profitable business with a highly skilled workforce with strong customer relationships and it is ideally positioned to help us grow our business, both in South Africa and across sub-Saharan Africa,” he says, adding that CVT will be a key building block, as EnerMech significantly expands its valves business and other business lines in Africa over the next few years.

Further, he adds that, “as the company has existing ties with steel company Saldanha Steel – a subsidiary of ArcelorMittal South Africa, Lesedi Nuclear Services and PetroSA – we will seek to reinforce those relationships, while securing work with other international players who are already aware of our valves expertise in other regions”.

CVT’s owner and MD Stephen David along with the company’s 19 staff will transfer to EnerMech. David will lead EnerMech’s valves operations in Africa, alongside newly app- ointed regional director Jean François Roche, who joined EnerMech in February.

“Our 20-year track record in the African valves market, combined with EnerMech’s international experience with major operators, opens up new opportunities, not just in our own backyard in South Africa, but in many other African States where large-scale oil and gas developments are in the pipeline,” David says, adding that the company is looking forward to playing a leading role in developing EnerMech’s full potential in Africa.

In addition, Roche says CVT has a solid reputation across the region and will make an immediate impact on EnerMech’s African operations.

“Our investment in a number of African countries demonstrates how important the region is to EnerMech for future growth, while our philosophy of establishing a strong local presence and infrastructure, using wherever possible the skills of a local workforce, and investing in training and the latest equipment, will bring long-term dividends for us and our clients,” he says.

Although most of CVT’s work falls within the petrochemicals industry, the company has also completed significant contracts in mining, iron and steel, power and oil and gas industries.

Further, the deal gives EnerMech access to a facility to support offshore rig repair work at Saldanha Bay, in the Western Cape, while the new partnership will allow the introduction of other service lines to CVT’s existing client base.

Duguid concludes that the oil and gas ser- vices industry in South Africa is experiencing a significant transformation – with a major push to attract more rig and floating production storage and offloading work to the country.

“Saldanha Bay has recently been designated a free trade zone to specifically attract industrial and oil and gas service companies. There are also a number of offshore gas, liquefied petroleum gas and liquefied natural gas projects approved for the country – two of which will need significant facilities in the Western Cape. In addition, there are expectations of a significant shale gas development in the next few years in the Karoo and Limpopo regions of South Africa,” he adds.