GR Engineering Services' (ASX:GNG) shares are set to rise after entering into an agreement to acquire Production Solutions, an independent provider of specialist operations and maintenance to the oil and gas sector across Australia and South East Asia.
GR will purchase Production Solutions from certain Australian and Malaysian subsidiaries of Oceaneering International for $5.75 million, funded from existing cash reserves.
Oceaneering is a global provider of engineered services and products, primarily to the offshore oil and gas industry, with a focus on deepwater.
Production Solutions was acquired by Oceaneering as part of its acquisition of AGR Field Operations in 2011.
The acquisition marks GR Engineering’s entry into the oil and gas services sector; once complete, Production Solutions will continue to operate as an independent oil and gas services business unit of GR Engineering.
The transaction will be immediately earnings per share accretive for GR with expected revenue of $36 million and EBITDA of around $2.4 million in calendar year 2014.
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