Speedy agrees Kazakhstan joint venture with Denholm
By Murray Pollok12 November 2013
UK rental company Speedy has established a 50/50 rental joint venture in Kazakhstan with Glasgow-based shipping, transport and oilfield services company J. & J. Denholm Group.
Speedy has acquired a 50% share of the rental business of Denholm Zholdas - Denholm’s subsidiary in Kazakhstan – for a price of US$4.4 million, $3 million of which will be payable in $1 million instalments over the next three years.
Denholm Zholdas rents equipment to Kazakhstan’s oil and gas sector industry, including major fields at Tengiz, Karachaganak and Kashagan. The company has been operating in the country for 20 years and its customers include Chevron and Exxon.
Meanwhile, Speedy has announced the appointment of a chief operating office, Mark Rogerson, a former senior executive at Costain Group (see separate story).
The joint venture will operate under the Speedy Zholdas brand in Kazakhstan. The existing rental business had revenues of $6.7 million and operating profits of $1.4 million in the first nine months of this year.
The joint venture expands further Speedy’s rental operations outside the UK. Although the UK still accounts for 94% of its revenues, it is its international operation in the Middle East - and primarily its project with Zadco at Abu Dhabi's Zakum field – that is growing the fastest.
Denholm Zholdas is based in Atyrau and has an operating hub at Karabaton, close to the onshore processing facilities for the offshore Kashagan field. In addition, there are rental depots at Tengiz, Karachaganak and the export port of Aktau.
Speedy's CEO, Steve Corcoran, said: "We are delighted to be accessing the exciting oil and gas market in the Caspian by working in partnership with such a well-established and highly-regarded partner.
“Denholm has an enviable reputation, built up over 20 years, for providing outstanding levels of service to major international oilfield clients in Kazakhstan. Having recently supported Denholm Zholdas on planned turnaround projects in the region from our existing business, this joint venture is a natural next step for both parties.
“Together with the Zadco project at Abu Dhabi's Zakum field, this joint venture means that Speedy now has a long-term presence at four of the largest oilfields in the world."
John Denholm, J. & J. Denholm's chairman and CEO, said; "We are delighted to be bringing Speedy in as a partner in our Kazakh plant hire business and believe their expertise and access to equipment will enable us to improve the level and range of service that we can offer our customers."
Denholm is a family owned business, founded in Glasgow, UK, in 1866 as a shipping agent. It became a major shipping company and in more recent years has diversified into transport, logistics, industrial services (including scaffolding) and oil and gas services.
According to its website, Denholm’s oil and gas business has revenues of £130 million and employs nearly 4000 staff, operating in the UK, Azerbaijan, Kazakhstan and the UAE. In addition to rental, it offers services including electrical and instrumentation, valve management, freight forwarding and recruitment.