Arle exits manufacturing unit for $630m

Arle Capital Partners has announced that Expro International, its largest portfolio business by value, has agreed to sell its Connectors & Measurements (C&M) business to strategic buyer Siemens for $630 million.

Expro’s C&M business makes subsea power cables and temperature and pressure sensors for the oil and gas field services market, and includes the Tronic and Matre brands. The business had revenues of approximately $119 million in the calendar year 2011, and employs 450 people in the UK, the US, Norway, Brazil and Malaysia.

“We will look to use the net proceeds from the sale of the C&M business to repay existing borrowings and support our strong position within the industry by further investing in the growth strategy of our core business,” said Expro chief executive Charles Woodburn.

Arle’s forerunner Candover Partners acquired Expro International in April 2008 in a £1.6 billion (€1.9bn; $2.5bn) take-private deal with co-investors including Goldman Sachs and AlpInvest Partners. The group paid an 8.5 percent premium to acquire the business, hoping to capitalise on record oil prices and a subsequent increase in oil exploration at the time.

We will look to use the net proceeds from the sale of the C&M business to repay existing borrowings and support our strong position within the industry by further investing in the growth strategy of our core business. Charles Woodburn

However, the firm was put under pressure by turmoil in the credit markets in the wake of the Lehman collapse, and a write-down of Expro’s value was partly blamed for the eventual wind-up of Candover Investments, the London-listed parent company of Candover Partners.

Arle was formed in a buyout of Candover Partners by its management team in April last year, with the spinout taking on more than €2 billion of Candover's investments. Arle focuses on businesses in the energy, industrial and services sectors typically based within the North Sea Rim but with operations that extend beyond those markets.

George Buckley, the former chief executive of global blue-chip manufacturer 3M who will join Arle as chairman in June, will also become Expro’s chairman.

The firm is still investing from Candover’s 2005 and 2008 funds, which have around €250 million of dry powder remaining, according to a source close to the firm.

Arle’s current portfolio comprises 12 European-headquartered businesses with an enterprise value of around €10 billion, the source said.