Varel intends to use the investment from Blue Water Energy to drive growth in the medium term. Credit: Zbynek Burival on Unsplash.

US drill bits supplier Varel International has secured a multi-million-dollar investment from international equity firm Blue Water Energy, which operates in the energy sector.

Varel intends to use the investment from Blue Water Energy to drive growth in the medium term. The company aims to regain its position as one of the key suppliers of oil and gas.

A revised strategy will see the deal explore potential international growth prospects, including merger and acquisition (M&A) opportunities, with the growing number of wells and the length of projects worldwide.

Varel CEO Derek Nixon said: “Partnering with Blue Water Energy gives us the impetus to really drive growth across the company. Our aim is to restore Varel to the top of the industry.”

“The new leadership team and I are extremely motivated to take the company in a new direction. The business will be built around customer’s needs, quality products and exceptional performance.”

“There will inevitably be a shift in strategy as we look to take full advantage of international growth opportunities, especially in India and the Middle East. We have a very open attitude to the future of the company, including being acquisitive in those markets.”

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This year, Blue Water and its co-investor Nixon Energy acquired Varel International and Downhole Products.

Through this acquisition, Blue Water has increased its portfolio to 23 companies. It has over $2.5bn under management across two funds,

Varel has its headquarters in Houston, US. Besides a regional base in Saudi Arabia, the company’s has key manufacturing assets in Mexico, Scotland, France and Russia.

In March 2014, Varel introduced new roller cone drill bits for the oil and gas industry, designed for the fast and effective drill-out of frac plugs.