Ashtead Technology, the subsea equipment rental company, has expanded its mechanical solutions service offering with the £20 million acquisition of Aberdeenshire-based Hiretech on a cash and debt free basis.

Established in 2011, Hiretech serves the international offshore renewables, decommissioning, and conventional energy markets.

Hiretech generated revenues of £6.5m, EBITDA of £4.1m and EBITA of £3.4m for the twelve-month period to October 2022.

The group expects the transaction to result in double-digit earnings accretion in FY2023 and generate returns significantly in excess of the group’s cost of capital in the first full year of ownership.

In order to fund the acquisition, Ashtead has increased its revolving credit facility by £20m with its existing banking partners.

As a result, the group now has access to a total RCF of £60m, put in place at IPO, which has also been extended for a further 12 months to November 2025 to facilitate future strategic investments and initiatives. The board expects pro forma net debt/EBITDA to be less than 1.2x at year end.

Hiretech is Ashtead Technology’s seventh acquisition in the last five years evidencing a continuation of the organic and inorganic growth strategy set out during its IPO in November 2021 and follows the group’s acquisition of WeSubsea in September 2022, which has been integrated and is performing well.

Allan Pirie, Ashtead Technology’s CEO, said: “Hiretech has an excellent reputation and strong track record of delivering high-performance equipment and services to the offshore energy sector and has been a key supplier to Ashtead Technology in recent years.

“This acquisition provides strong synergies through vertical integration of the supply chain, and meaningfully expands our business by adding complementary capabilities to strengthen our mechanical solutions service line and deliver an enhanced offering to our customers.”

Andy Buchan, Hiretech’s CEO, said: “This is an exciting time for the business. As well as creating a tremendous opportunity for our people, becoming part of the Ashtead Technology Group will enable us to expand our existing capabilities and international footprint.”