Aberdeen-based oil and gas engineering services company Plexus Holdings said it raised $5 million via a discounted issue of 6.76 million shares to Russian equipment manufacturer Gusar.

Plexus said the share deal will accelerate its entry into the major Russian oil and gas production wellhead equipment market.

The 52.05p per share price of the issue represented a 10% discount to the five-day average price prior to the day before the signing of the agreement, which will give Gusar a 7% stake in Plexus.

Plexus shares were trading up almost 6% at 62.95p after the announcement.

The share issue follows Plexus’ announcement in January that gave details of a licence agreement with Gusar and CJSC Konar for the manufacture and supply of Plexus’ jack-up exploration wellhead equipment in the Russian Federation and other CIS states. 

“We are pleased to have secured additional funding for Plexus at a time when trading conditions are clearly challenging, and welcome Gusar as a new shareholder,” said Plexus’ CEO Ben Van Bilderbeek.

“We are also delighted to further strengthen our licensing and commercial relationship with Gusar and Konar as we advance our strategy to expand Plexus’ geographic reach beyond the North Sea, and look forward to developing with our Russian partners a range of superior and locally manufactured wellhead equipment for a variety of field applications.

“Russia has for some time been a key potential market for Plexus …

“The US Energy Information Administration in 2014 ranked Russia the third largest producer of petroleum and other liquids and estimated it holds almost a quarter of the world’s proven natural gas reserves. 

“With gas forming the vast majority of the Russian energy sector and our best in class wellhead equipment being ideally suited for the most challenging gas service conditions, this dynamic market offers considerable commercial opportunities for Plexus, Gusar and Konar.”