Cypress Energy Partners acquired a 51 percent controlling interest in the hydrostatic testing business, Brown Integrity, which owns Pipeline Services International.
“We are thrilled to join the Cypress family of companies and the expanded opportunity to grow our business serving the dynamic pipeline industry. We have been approached by dozens of suitors over the last few years and Cypress was the only party we considered for this strategic relationship,” said Charlie Brown co-founder, president, and CEO of Brown. “I look forward to working with Cypress and the Tulsa Inspection Resources team providing best-in-class services to our industry.”
Brown is among the sellers that will retain the remaining 49 percent interest. The accretive all cash $11.2 million acquisition (subject to working capital and other customary adjustments) includes a multi-year earn out and Cypress will have the right to acquire the remaining 49 percent interest in the future.
“We are pleased to announce this strategic transaction with Brown and are delighted to have an opportunity to work with Charlie and the rest of the team building the company. Hydrostatic testing is a critical aspect of the pipeline industry and the acquisition is consistent with our previously stated goal of broadening the suite of services we offer our blue chip customers in the pipeline industry,” said Peter C. Boylan III, CELP’s Chairman, president and CEO. “Brown has an outstanding reputation and we believe that our pipeline inspection subsidiary, Tulsa Inspection Resources, can help grow their business dramatically.”
Boylan added, “The Brown acquisition demonstrates our commitment to growth. We continue to evaluate a number of interesting opportunities, while being very disciplined regarding valuations, and hope to complete one or more of such additional opportunities in the next several months. We continue to remain focused on building a great company that will create long term value and distributable cash flow growth for our unitholders.”