Bunbury may seem an unlikely location for an engineering company looking to service the international oil and gas industry, but SWG Holdings doesn't believe location is an issue.
Bunbury may seem an unlikely location for an engineering company looking to service the international oil and gas industry but SWG Holdings, which was bought by Melbourne’s Programmed Maintenance Services Ltd for $40 million in a deal announced last week, doesn’t believe location is an issue.
The sale of SWG is the culmination of three years of growth by the company, which started in a shed in Bunbury’s industrial precinct in 1994.
It has achieved an average 97 per cent revenue growth for each of the past three years and is aiming for more growth from its engineering, construction and maintenance services for the oil and gas, and mining sectors.
Founded as a fabrication and maintenance company by local businessman Craig Halligan, by 2005 SWG was employing 85 staff and had a revenue of about $10 million.
That’s when Mr Halligan asked David Kaestner to come on board.
Mr Kaestner had a history of involvement in significant onshore and offshore oil and gas projects, including working for French engineering company Technip on the $US800 million Dalia project in west Africa.
He called on a former colleague at Technip, Scott Anderson, to help him take SWG to a much bigger scale.
With projected turnover of $100 million this financial year, a professional staff of about 150 people, two offices in Perth and another in Singapore, Messrs Kaestner and Anderson have revolutionised SWG in less than three years.
Now chief executive officer of SWG, Mr Kaestner has brought a number of former industry colleagues into the company’s orbit
This includes SWG chairman Mark Bradley, one of several people who previously worked with Messrs Kaestner and Anderson at Australian engineering company Clough Limited.
The pair also worked previously with Programmed Maintenance Services managing director Chris Sutherland.
“All the players know each other; we know what we can do and we’ve been doing it for 20 years together in one way or another,” Mr Kaestner said.
SWG is capitalising on WA’s resource project overdrive, planning to enhance its presence in mining maintenance and construction.
“We all know there is a vacuum and enough room for another player,” Mr Kaestner said.
It is also looking to take on progressively bigger projects, and aims to lift turnover to in excess of $300 million by 2011.
Mr Kaestner is wary of the growing too much, too soon syndrome, but is largely unfazed.
“The fact is that [the resources boom] is an opportunity,” he said.
“There’s no question, the targets we have are ambitious.
“But it’s about judgement. Look, can you fall over? Like everyone else, you can, and I think when you’re growing fast you need to keep that in mind.”
Mr Kaestner also exhibits no fear about the deal with Programmed Maintenance Services falling through.
The deal can be scrapped if Spotless Group succeeds in its hostile takeover bid for PMS.
“Our profile has already risen just in the fact we’ve had the offer. So even if Spotless comes in, so what?” Mr Kaestner said.
“The fact is, we’re on the radar. And the reality is we should be.”
He said SWG would stay in Bunbury, no matter how high its star rises.
“I think people have a view that, if you’re in the country you’re a smaller organisation, they tend to pigeonhole you. Their view is if you’re going places, you’re bound to be in a capital city,” Mr Kaestner said.
“But we don’t feel constrained by that. Our view is we can break the mould.”
