Fenner plc has expanded its seal operation in the Asia/Pacific region with the purchase of a manufacturer of products for the growing oil and gas industry.
Multiseals Pte. Ltd., a privately held Singapore producer of sealing offerings with deep roots throughout the region, was acquired by Fenner Singapore Pte. Ltd., a subsidiary of the Hessle, England-based diverse product maker, for about $11.8 million, a Fenner official said.
The purchased business will become part of Fenner Advanced Sealing Technologies. That division is based in Humble, Texas, home of two major FAST operations, CDI Seals and EGC Plastics, located at a 204,500-square-foot plant.
Included in the deal, which closed April 28, is a robust manufacturing facility in Singapore, according to a CDI spokeswoman. Multiseals' workforce will remain in place and the operation's management team, which is capable and well-versed in their market, will continue to direct the unit, she said.
As part of Fenner's growth strategy, Multiseals' offerings will be expanded to include the full range of oilfield products currently produced by CDI, a custom manufacturer of seal, elastomeric and plastic components for the oil and gas industry.
The spokeswoman said new capabilities will be added at Multiseals' plant, such as materials and engineering expertise.
The partnership also combines both companies' custom-molding and high-performance machining capabilities.
Multiseals is well-positioned in the Asia/Pacific oil and gas market and well known for their reliability and quality, she said. Fenner knew that this was a steadily growing market and identified the region as a strategic target.
Multiseals was already a distributor for CDI Seals, so it made sense that the acquisition would help grow FAST's footprint while enhancing Multiseals' capabilities.
Fenner has a presence in the Asia/Pacific region, but the majority of it was not focused on the oil and gas market, the spokeswoman said. Multiseals is a certified seals provider to most of the major oil and gas companies in the region, she said, which will significantly boost FAST's presence there.
The area has a history of heavy-drilling activity to support high regional energy demands, which is growing at an estimated rate of 11 percent annually, Fenner said. Because the Asia/Pacific region is growing rapidly, CDI President Leonard Casey said, the company's customers are dedicating more resources to that area. That has created the need for CDI to expand globally with them.
Multiseals has an exceptional reputation for quality in Asia, just as CDI does in the States, Casey said. The acquisition allows us to provide our customers in Asia/Pacific the material engineering and expertise that our customers in the Western Hemisphere currently experience.
A new CDI product line that will benefit from the acquisition is the recently launched Tuff Breek range of oilfield offerings. Both CDI and Multiseals will manufacture the line including well-packing products specifically designed for hydraulic fracturing and pressure-pumping operations in oil and gas developments.
CDI, which has served the oil and gas industry for 35 years, came out with the Tuff Breed expendable line in April. Its initial offering boosts an established well service packing product line, the company said
The FAST division was formed in 2005 when Fenner purchased Wellington Holdings, consisting of CDI and Hallite Seals, which were merged. The following year, it bought EGC Plastics and in 2008 linked it with CDI in the Humble plant.
FAST is well-respected throughout the global seals market as a precision manufacturer, the spokeswoman said.