John Wood Group PLC (‘Wood Group’) has acquired Industrial Repair Service, Inc. (‘IRS’), an electrical generator services company providing specialized generator maintenance, field outage engineering, and high voltage coil support services to power companies throughout the Americas. The cash consideration being paid for IRS is approximately $9.3m at completion including the assumption of net debt, plus a potential further payment in 2006 or 2007 of up to $1.5m, which is subject to future profitability. IRS had revenues of $15.4 million for the year ended 31 December 2001.
The company, founded in 1979, is based in Farmington, New Mexico, and employs 120 staff within two operating facilities, one focussing on on-site and shop-based generator service work, and the other specializing in engineering, design and fabrication of low, medium and high voltage generator windings. IRS will continue to be led by the existing management team, headed by Ben and Paul Heikkinen.
‘The acquisition of IRS is a strategic expansion of our US gas and steam turbine maintenance capabilities,’ explained Allister Langlands, Wood Group’s Deputy Chief Executive and Director responsible for Gas Turbine Services. ‘IRS services a wide range of large electrical generators, which are predominantly driven by gas and steam turbines that fall within Gas Turbine Service’s existing maintenance capability. Combining IRS’ generator expertise with our turbine capabilities will enable us to provide a more comprehensive range of services to support the maintenance operations of our customers, which include independent and merchant power producers, utilities and consolidated energy companies. Our first move following the acquisition will be to make a $2m investment in high speed balancing equipment, which will greatly enhance IRS’s capacity, quality, and range of services.’
Ben Heikkinen said: ‘We at IRS are very excited to be joining Wood Group. We believe that our skills and capabilities are very complementary to those of Wood Group Gas Turbine Services, and are confident that together we can deliver an expanded range of services to existing and future customers in the North and South American power generation markets.’