Gladstone backs an oil and gas deal

The Virginia BDC is providing $8.75m in equity and debt financing to Southern Petroleum Labs in its acquisition by a consortium of private equity firms.

The Gladstone Capital Corporation, a McLean, VA-based business development company, has invested $8.75 million in a combination of debt and equity to facilitate the acquisition of Southern Petroleum Laboratories by a consortium of private equity buyers. Boston based private equity firm Hastings Equity Partners announced yesterday that it would investing in SPL as part of its third fund, in partnership with private equity firms Jordan/Zalaznick Advisors and the Edgewater Funds.

SPL has been in the oil and gas production industry since 1944. The company has an independent lab, measurement and field meter services. Its clients use the information to support refining plans, determine the value of the oil and gas at the point of sale and to satisfy regularity filing requirements. SPL also provides well production allocation services. The company has six offices across Texas, as well as outposts in Louisiana, Mississippi, Michigan and Alabama.

“SPL is a recognized leader in the oil and gas production industry. We see many opportunities for growth, driven by the increasing activity in this sector of the energy industry and by geographic expansion,” John Freal, a managing director of Gladstone Capital, said in a statement.

Gladstone is a publicly traded BDC that invests in debt and equity securities, consisting primarily of senior, second lien and senior subordinated term loans in small- and medium-sized businesses in the US.