With intimate sector knowledge, we can generate above-market returns in any market cycle, pinpointing micro-tailwinds that can grow market share even against macro-headwinds. We assess each investment based on four key criteria: Differentiation, Management Team, Market Tailwinds, and Accurate Valuation. These cannot be determined solely from a spreadsheet. Experience trumps everything.
Now is the time to invest.
After the COVID-19 pandemic, the market landscape experienced a tectonic shift. Rational and irrational sentiments have created a conundrum few are willing to admit. Capital has fled the sector as momentum investors look to capitalize on short-term hysteria. Instead, we choose to focus on the fundamentals that support long-term investments in our energy future.
Demand for energy is not only unwavering, it will continue to grow with our population and as underdeveloped countries build out their infrastructure. To supply that demand, we will need all forms of energy. While others have fled, we have rolled up our sleeves.
Targeted investments based on micro-drivers.
No two oilfield service businesses are alike. Beyond rig count, numerous variables impact their ability to grow. While generalists focus on two or three obvious market indicators to inform their projections, we dive deep to uncover the exact micro and macro drivers that impact the business. We know well how cyclical the industry can be, but where others see risk, we see opportunity.
Drilling, completion, production, midstream, and downstream sectors all have different assumptions and drivers that affect our projections. Beyond that, each individual product set and service line has its own micro-drivers that can create opportunities even in an overall market decline. We pay attention to the details, using extensive industry knowledge to see what others cannot.
Diversified investments within the oilfield sector.
Each industry sub sector has different tailwinds and headwinds throughout various market cycles—a fact often misunderstood by generalist investors. We tailor our investment strategy based on granular drivers by sub sector.
We identify strong companies.
Pelican seeks profitable, established businesses with EBITDA generally between $1 million and $15 million annually, while we have the ability to consummate transactions with EBITDA up to $30+ million. We work well with entrepreneurial management teams that demonstrate competitive advantages in a well-defined market segment. Finally, we partner with companies respected by their customers for having fair and honest business practices aligned with our own core values:
- Safety: Lead by example
- Integrity: Always take the high road
- Excellence: Constantly learn, apply the lessons, and improve
- Humility: We are not perfect, no one is
- Fulfillment: Have fun. Enjoy what you do and make things better every day
Creative structuring and flexible deal making.
Each entrepreneur and company has a different reason to seek funding and different goals regarding recapitalization. In a dynamic industry, we have learned to be flexible and creative, structuring and successfully executing win-win deals for our investors and management teams in numerous scenarios:
- Acquire scaled businesses with identified opportunities for growth or profit improvement
- Implement conservative capital structures to reduce investment risk
- Identify and negotiate attractive buying opportunities
- Partner with entrepreneurs to drive scale and professionalization
- Provide growth capital and expertise to foster profitable and focused growth
- Identify innovative products that can disrupt the competitive landscape
- Partner with veteran management teams and organizations starting a new platform
- Provide balanced decision making between speed and cost efficiency
- Identify and acquire non-core businesses that have opportunity to improve with more focus and direction
- Stand up businesses through complex transitions to new stand-alone enterprises
- Strategically partner with exceptional founders and entrepreneurs seeking to remain highly involved in business
- Represent minority recap opportunities with significant structural and economic protective provisions
- Directly acquire distressed debt at steep discounts and converting debt ownership to equity control
- Take a hands-on approach to create real value amidst challenging situations requiring operational, financial and commercial improvement