Investcorp acquires majority stake in NDT Corrosion Control Services

14 Jul 2015

Investcorp, a global provider and manager of alternative investment products, today announced that it has completed the acquisition of a majority stake in NDT Corrosion Control Services Co. (“NDT CCS” or “the Company”), the largest testing services company for the industrial sector in Saudi Arabia. Investcorp acquired the stake in NDT CCS from the Al Shuwayer Group, which founded the Company in 1975 and retains a minority stake alongside Investcorp.

NDT CCS, which also has operations in the UAE and licences to operate in Kuwait and Qatar, provides non-destructive testing (“NDT”) services for a range of industrial sectors including oil and gas, petrochemicals, mining, nuclear and utilities. NDT involves the evaluation and testing of pipes, valves, oil platforms and other key industrial components and identifying faults, cracks or defects without causing damage. NDT is an essential service that is offered at a low cost relative to the overall value of the components being tested and is required during both the construction and the maintenance of sites and facilities. NDT CCS provides a broad range of NDT services to a large blue chip customer base, which includes Saudi ARAMCO, SABIC, Ma’aden, Saipem and Hyundai Heavy Industries.

Mohammed Al-Shroogi, Investcorp’s Co-CEO, said: “NDT CCS has firmly established itself as Saudi Arabia’s market leader in the NDT industry. We believe that the Company is well-positioned to solidify its leading position and gain a greater market share in a sizable, growing and fragmented industry. Investcorp will support the Company to grow its existing business in the UAE as well as expand into Kuwait and Qatar. Investcorp will seek to leverage its previously successful experience with Moody International, a global provider of inspection services and international certifications. Investcorp acquired Moody International in 2007 and successfully sold it in 2011. As is the case with other corporate investments across the Gulf, Investcorp is the first institutional owner of NDT CCS and we believe we are well positioned to unlock the Company’s potential, optimize its operations and drive its next phase of growth.”

James Tanner, Head of Corporate Investment – MENA and Managing Director at Investcorp, commented: “NDT CCS benefits from having the largest number of skilled technicians together with a broad service offering. The Company has been successful in securing a healthy mix of projects and maintenance contracts, which we believe positions it favourably to help achieve sustainable and profitable long-term growth. We are excited about partnering with the Al Shuwayer Group and capitalizing on the strong demand fundamentals that are supported by an aging infrastructure base and high safety requirements by asset owners.”

Mishal S. Al-Ardi, CEO of Al Shuwayer Group and shareholder, said: “Investcorp is the ideal partner to help support the growth of NDT CCS. It has an extensive track-record of successfully investing in the GCC and has specific industry experience through its investment in Moody International. I am looking forward to working closely with our new partners to bring NDT CCS to new markets as well as broaden our service offerings.”

NDT CCS has an independent team of professionals, which has been working together at the Company in Saudi Arabia for over 17 years. The team has managed to successfully grow the business not only in Saudi Arabia but also in the UAE. NDT CCS has three branches across Saudi Arabia and one branch in the UAE with 12 sites across both countries.

This is Investcorp’s fifth acquisition in Saudi Arabia after Leejam, the owner and operator of the leading fitness chain “Fitness Time”; Theeb, the leading car rental business; Al Yusr Industrial Contracting Company (AYTB), a leading provider of industrial services outsourcing solutions; and L’azurde, a leading designer, manufacturer and distributor of gold jewellery.