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Venture capitalist shuts Aberdeen office

Venture capitalist shuts Aberdeen office
Private-equity investor 3i Group said yesterday it had closed its Aberdeen office after having sold its last interest in oil and gas.

Private-equity investor 3i Group said yesterday it had closed its Aberdeen office after having sold its last interest in oil and gas.

The venture-capital company owned half of north-east energy service firm RBG before it was sold to Stork Technical Services earlier this year in a deal believed to be worth up to £250million.

The firm, which first set up a presence in Aberdeen in 1974, said the two executives it employed at its Queens Road office had now left 3i.

It added that it had left Aberdeen as part of plans to cut back resources, although the move came amid buoyant times for the North Sea oil and gas industry.

This week alone, subsea firm Bibby Offshore and oil service company Sparrows said they would be adding a combined 250 jobs to their north-east workforces after recent contract wins.

A 3i spokeswoman said: “The UK currently represents 29% of our portfolio value, so these changes are focused on ensuring that we have the right resource for the market opportunity.”

She added that 3i would continue investing in the UK and that it would remain interested in good energy investment opportunities as they arose.

Andrew Reid, managing director of Aberdeen-based energy consultant Douglas-Westwood, said he believed 3i had pulled out of Aberdeen not because it felt the market was flat but because the sector’s growth had attracted competition.

He added: “They had a good team and they will be a loss but this is not a sign of a dying market; there is a lot to look forward to.

“They (3i) have had a huge degree of success within energy investment over a number of years. They built up a position where they had a near-monopoly in the north-east.

“It is now a far more competitive market and there are probably six to eight private-equity houses based in Aberdeen as well as some London firms looking at the north-east.

“It is not that there are no private-equity opportunities in Aberdeen, it’s just a crowded space and a lot of people are aggressively moving into it.”

Mr Reid said 3i had held stakes in the likes of Petrofac, Wood Group and Vetco in the past but it was now likely to focus more on the global market. He added: “For 3i to replicate what it had five to 10 years ago would have been a challenge, if not impossible, and they have maybe decided to look at opportunities elsewhere.”

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