Energy Training Partners Inc.
Energy Training Partners Inc. (ETP) was founded in 1992 by Linda Blair and is a world leader in providing training solutions. ETP’s training programs are a combination of off-the-shelf and customized programs which cover 250 subject matters focused on the energy market. Customers include large oil and gas companies, energy traders, and other companies that are highly dependent on energy markets. The professional management is led by owner, Linda Blair, who is committed to the long-term running of the business. Revenues are approximately $120.0 million and EBITDA are approximately $25.0 million, without debt.
ETP is a privately owned company and it is divided into two programs, Princeton Energy Program and The College of Petroleum and Energy Studies. The Princeton Energy Program offers workshops that give delegates the opportunity to take an active role in their classroom training. The College of Petroleum and Energy Studies offers an in-depth view of specific industry topics through instructor-led courses.
Additional information about ETP including: people in key management positions, selected course titles for the Princeton Energy Program and the College of Petroleum Studies, ownership details, management projections, and an overview of the current situation is as follows:
ETP Management
Linda Blair President & CEO: Linda founded ETP in 1992 and has been the primary driver behind the company’s rapid growth. Linda is 62 years old, and is eager to continue the expansion of the company. Linda did experience a serious health scare in 2007, but is committed to continue as President for the foreseeable future.
Bobby Banderas (Director of Global Operations): Bobby is the number 2 executive at ETP, and has been responsible for ETPs global growth, especially in Asia. Bobby came to ETP from a larger consulting firm, and has played a key role in ETPs success.
Herman Carter Chief Financial Officer (CFO): Herman is a recent hire of ETP, and is one in a string of CFO hires. ETP had trouble in retaining good CFO’s, and fired several who were not working out. Herman has strong accounting experience, and is effectively managing financial operations. Herman has been the CFO for several successful privately held companies. Herman did not have significant experience in managing a leveraged operation, and his banking relationships are limited.
ETP Selected Course Titles
Princeton Energy Program
Princeton Energy Program consists of the following workshops:
- Fundamentals of Energy Futures
- Energy Risk Management
- Fundamentals of Technical Analysis
- Front to Back Office: Trading Controls and Best Practices
- Value-at-Risk: The Basics and Beyond
- Overview of North American Natural Gas Industry
- Understanding Emissions Tradi
College of Petroleum Studies
College of Petroleum Studies consists of the following courses:
- The Olefins Business – Markets and Economics
- International Oil Trading – Advanced Techniques and Strategic Price Risk Management
- Aviation Fuels: Supply, Trading and Risk Management
- Tanker Ownership: Chartering and Operations
- Understanding the International Petrochemicals Business – Technology, Markets and Economics
ETP Ownership Details
Common Equity
- 95% of the common equity shares are owned by the Blair family, either directly by Linda herself or in several trusts set up for the benefit of family members.
- 5% of the company is owned by Bobby Banderas, through a special bonus program set up ten years ago.
- The company is an S-corporation, and pays taxes at the shareholder level.
Equity Options
- Equity options pool has been set up for senior management, and has set aside 500 options in ETP that have vested with the senior management team and key employees.
- The strike price for these shares is $20.00 per share. ETP has a valuation done using a 6.0Xs trailing EBITDA to value the company.
- Management has the right to convert any “in-the-money” shares for their cash equivalent at the end of every calendar year.
ETP Management Projections
Management’s projections for ETP are based on a bottoms-up analysis of customer demands and product sales are listed in Table 13.1 and Table 13.2. Margin improvement is projected to be modest due to limited operating leverage associated with course delivery.
ETP Situation Overview
Energy Training Partners has enjoyed significant growth and success in its core market – providing education and training to the petroleum industry and related companies. The majority shareholder and founder of ETP, Linda Blair, is committed to continue the expansion of the company but she has determined the energy industry training market and size characteristics which limit growth. The following items are currently being analyzed.....................
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