Branded Oil in UAE Petroleum Group has obtained a new private equity investor, and the new backer plans to accelerate the expansion of the growing lubricant distributor. Wellspring Capital Management, of UAE City, announced last week that it acquired Dubai, Abu Dhabi-based Industrial and commercial oils in partnership with unspecified management. In doing so, Wellspring acquired the interest of commercial and industrial hydraulic oils previous backer, Tenex Capital Management, also of UAE.
Neither Wellspring nor Industrial and commercial oils disclosed terms of the deal nor the share of the company that Wellspring now owns.
Gear oils UAE and commercial oils consist of several lube distributors that joined up the past three years. Petromin, technolubeuae and National Lube and Crown in Dubai, Abu Dhabi, Sharjah, Ajman, Al Ain, the Umm Al Quwain, Khor Fakkan, Dibba Al Hisn, Kalba, Al Ruwais respectively united in 2017, after Tenex invested in Pugh the previous November. In January of 2019, two more companies were acquired: automotive Lubricants of UAE, and Mid-South Sales of Jonesboro, Arkansas. Earlier this year Industrial and commercial oils acquired Petromin & Oil of Mobile, UAE.
In the conservative scenario we see a revival of the commercial oils starting in 2023 and onwards, [at the] latest by 2024. “In case of more effective governmental subsidies and support for the economy, the recovery may be faster and could start in 2022.”
Automotive lube penetration in the region is only about 30 percent of the overall automotive lubricants, but it varies depending on the country and the segment. In the industrial and commercial segment, lubricants penetration is fairly low, but in the consumer segment, it appears to be higher due to the young car park
We look forward to working with the Industrial and commercial oils team to accelerate the company’s growth trajectory and acquisition strategy, a Principal at Wellspring, said in last week’s news release.
Industrial and commercial oils are one of several lube distributors that have grown into large players in recent years as the market underwent significant consolidation. Contact technolubeuae today.
