Funding for acquisition vehicle
Frontrow backed by £10m BGF support
Company plans more deals
Capital investor BGF (Business Growth Fund) has pumped £10 million into acquisition vehicle Frontrow Energy Technology Group alongside £3m from the company’s founders.
Frontrow will use BGF’s funding to expand its resources and infrastructure, allowing it to develop more young technology companies in the region’s energy industry.
Formed in 2013, the Frontrow team has created a hub for the development of new technologies backed by operational guidance and expertise.
Companies already in the group include Well-Sense, Well-Centric and Interventek, all based the incubator facility in Dyce, Aberdeenshire where they have access to extensive shared resources.
Frontrow was set up by chairman Graeme Coutts, the former chief executive at Expro Group and current chairman of BGF portfolio companies Spex Group and STATS Group.
The Group is led by chief executive Stuart Ferguson, former chief technology officer at Weatherford, with an established track record in building valuable oilfield technology businesses.
The senior team includes non-executive director Colin Smith, who sold his Petrowell business to Weatherford in 2012, and executive director Frank Summers, who ran the successful Simmons Fund 1 leading investments in Red Spider Technology, Xodus and EFC.
Mike Sibson, an investor in BGF’s Aberdeen office will join the board of Frontrow. He said: “The past two years have been incredibly challenging for companies operating in the North East of Scotland’s oil and gas industry, and many entrepreneurs have understandably been shaken by the downturn.
“Despite these strong headwinds in the energy industry, and across the whole of UK, 2016 was a record year for BGF, and we will continue partnering, supporting and investing as part of our strategy to provide truly long-term capital to companies scaling up.
“This deal allows us not only to invest in the growth and development of Frontrow, but it also extends our reach into younger, earlier stage companies in oil and gas, and the broader energy industry.
“We are backing a team with a deep understanding of energy technology, a strong industry network and the operational experience to bring new products to market.”
Mr Coutts added: “This funding will allow us to acquire and to grow more high-potential companies in the energy sector.
“Our vision is to build a group of world-leading technology businesses based here in the North East of Scotland, which has long been a centre for the development of downhole and subsea technologies.
“We’ve had a long-standing relationship with Mike Sibson and his colleagues, so BGF was top of our list when we wanted to expand Frontrow’s capability. We’re not just tapping into the capital that BGF can supply but also into its expertise and network.”
BGF’s other portfolio companies in the oil and gas industry include STATS Petrotechnics and Rovop, while its investments in the broader North-East business community consist of IT services business Inoapps, optician chain Duncan & Todd and food and garden waste firm Keenan Recycling.
BGF is taking a minority stake in Frontrow as part of the investment.
Photo – top: Graeme Coutts (left) and Mike Sibson; above right – Stuart Ferguson