Analytical testing services group ALS will spend more than $500 million to increase its exposure to the growing oil and gas industries.
ALS, previously known as Campbell Brothers, will pay SCF Partners $A579 million for global oil and gas services provider Reservoir.
To help fund the acquisition, the company will launch a $246 million rights issue for its shareholders.
The remainder of the purchase will be funded through a new $US275 million ($A304.49 million) debt facility, a share issue to Reservoir senior management and ALS cash reserves.
ALS has also agreed to acquire Australian-based Earth Data, a provider of niche sampling and analysis services to Australia's oil, gas and coal industries.
Chief executive Greg Kilmister said the acquisitions were part of the company's efforts to increase its exposure to the high-growth oil and gas sectors.
"The acquisition will considerably broaden our capabilities in upstream oil and gas and will strongly complement our existing laboratory services," he said.
He said ALS's focus on laboratory services would complement Reservoir's existing portfolio of technical services.
ALS plans to build at least three oil and gas hub laboratories to service the global market.
The company has focused on pursuing new markets in recent years to offset its exposure to the weakening mining sector.
Meanwhile, ALS says it expects its underlying net profit for the six months to September 30, 2013, to be between $A95 million and $105 million.
ALS shares have been put in a trading halt until Friday. They last traded at $9.41.
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