Kohlberg Kravis Roberts & Co. L.P., a leading global investment firm, today announced the signing of a definitive agreement under which funds advised or controlled by KKR are acquiring a significant minority stake in RigNet, Inc. (NASDAQ: RNET) from Cubera, an investment firm specializing in the Nordic private equity market.
Upon closing of the acquisition of 4.75 million shares, which is subject to customary approvals, KKR will become RigNet’s largest shareholder, holding a 27% stake in the company.
RigNet is a leading provider of managed remote communications solutions, systems integration and collaborative applications to the global upstream energy sector. Operating across the life of the field, RigNet serves offshore and onshore drilling rigs, production facilities and energy maritime with solutions ranging from fully-managed voice and data networks to more advanced applications that include video conferencing and real-time data services. It provides services to over 1,100 remote sites in over thirty countries across six continents.
Johannes Huth, Member of KKR and Head of Europe, stated: “We are investing in a fast-growing global market leader that has created an attractive niche at the intersection of three of our core investment themes: energy, technology, and services. All three sectors exhibit structural growth well ahead of broader GDP trends. We are excited about this addition to our investment portfolio and we look forward to supporting RigNet’s growth strategy as a patient and constructive shareholder.”Mattia Caprioli, Member of KKR and Head of KKR’s services sector team in Europe, added, “We believe that the digitalization of upstream energy has only just begun. A prime example is the rapidly growing demand for broadband connectivity for oil and gas operations in remote and harsh environments. Today, the connection speed of deepwater drilling rigs is a fraction of the internet connection speed of a typical family home. Scarce bandwidth needs to be shared between regulatory supervision, remote management, firm-wide ERP systems and business communication. Crew well-being is increasingly tied to connectivity as employees stay in touch with their families, use telemedicine services and use web and intranet as a source of infotainment and training. As significantly more bandwidth capacity becomes available and more real-time information is shared between rigs and headquarters, drillers, operators and oil field services providers will be able to improve health and safety, drive operational efficiencies and boost crew morale. We expect RigNet’s mission-critical connectivity, integrated systems and innovative services to play a vital role in helping customers shape the digital oil field of the future. We share management’s goal to establish RigNet as a pre-eminent global services provider to the oil and gas industry.”