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US investment giant Apollo is set to buy UK energy services business OEG Energy Group at a more than $1bn valuation as investors bet on surging demand for power from data centres and artificial intelligence.
Apollo will acquire a majority stake in OEG, which provides services for offshore oil, gas and wind production, from Oaktree Capital Management. Oaktree and other shareholders will retain minority shareholdings, according to people familiar with the details.
OEG was founded in 1973 and has its headquarters in Aberdeen. It has expanded over the years including through acquisitions and has more than 1,300 employees with operations in 65 countries. Oaktree, a US investment manager, partnered with OEG’s management to buy the company in 2023.
Many investors are pushing into the power sector to take advantage of surging demand for electricity from data centres and AI.
In February, asset manager Brookfield said it was buying National Grid’s onshore renewables business in the US for $1.7bn. It also signed a deal with Microsoft in 2024 to develop 10.5 gigawatts of green energy capacity to help supply data centres.
Over the past five years, Apollo has put about $58bn into climate and energy transition investments. In December, funds managed by the group bought half of a solar and battery project in Texas from TotalEnergies.
In total, Apollo has around $751bn of assets under management as of the end of last year.
OEG owns and operates one of the world’s largest fleets of cargo-carrying units, containers designed for use in the offshore energy sector.
In its latest accounts, filed at Companies House, for the period between March and December 2023, it reported revenues of $320.6mn and a pre-tax loss of $15mn.
In February, OEG said it expected revenues for 2024 would be more than $500mn, with renewables expected to account for about 55 per cent of that.
It is targeting $1bn in annual revenues by the end of the decade, hoping to benefit from planned growth of offshore wind farms as countries try to decarbonise their electricity systems.
OEG chief executive John Heiton said, “This is a positive outcome that brings in a new majority owner with a shared vision of growth through the energy transition.” Oaktree and Apollo declined to comment.
