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Oil and gas engineering company Specialist Energy Group (previously called Southbank) was admitted to AIM after a reverse takeover of clean coal business Nviro Cleantech, raising £4 million in the process. M&A talks to CEO Ewan Lloyd-Baker.

What were the reasons behind the deal?

The deal gives us access to Nviro's clean coal technology, which treats coal to improve its thermal efficiency and reduce its carbon emissions. The price of coal has just gone up so there's great potential. We've also been looking to join AIM for a long time.

What advantages does AIM offer?

We were listed on the Channel Islands Stock Exchange (CISX), which we were using as a stepping stone to join a better-known and more liquid market such as AIM. We operate on a global scale and AIM has much wider coverage than CISX, which would improve our long-term growth prospects. We also wanted access to institutional investors.

What challenges did you face?

The deal took longer than anticipated. A reverse takeover is not as a straightforward as an IPO. We had to deal with two groups of shareholders, as opposed to just one, and we had to work out the metrics of acquiring another business and whether it would work.

How has the recession affected your business?

Our business has been driven by demand from China and India, and they've been less affected by the recession. There's a direct correlation between electricity consumption and GDP growth, and we've done well from supplying emerging markets. However, we have been affected by the tightening of liquidity in Europe and the US, which has had an impact on our growth plans.

Do you have plans for further acquisitions?

I think the second half of 2010 will be a more attractive environment for M&A. Access to capital will improve and there will be less uncertainty in the market. In the subsea oil and gas market, there's plenty of scope for consolidation.

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