Prospects for Plexus Holdings (ZYT), along with any number of oil equipment suppliers, have been stymied by uncertainty following the prolonged slump in crude oil prices from mid-2014. Shares in the company - owner of the proprietary POS-GRIP friction-grip method of wellhead engineering - have lost two-thirds of their value since July of that year and the company’s latest trading update in May revealed a “further material reduction” in revenues for its June year-end.
However, management did highlight a number of “specific opportunities in the North Sea and overseas” that were still subject to negotiations. Plexus is still operating in a buyers’ market, but subsequent to May’s warning, investors can take some encouragement from supply deals completed with the likes of Rosneft, Centrica and Maersk. The company has just revealed the sale of its wellhead exploration equipment and services business for Jack-Up applications to FMC Technologies, a subsidiary of TechnipFMC. Plexus will receive an initial cash consideration of £15m, with an additional sum of up to £27.5m contingent on the future performance of the Jack-up business during a three-year earn-out period.
