HOUSTON, Sept. 5, 2017 /PRNewswire/
-- PATTERSON-UTI ENERGY, INC. (NASDAQ: PTEN)
("Patterson-UTI") announced today that it has entered into an
agreement to acquire Multi-Shot, LLC d/b/a MS Energy Services ("MS
Energy"), on a debt-free basis for total consideration of
approximately 8.8 million shares of Patterson-UTI common stock and
$75 million of cash. Based in
Conroe, Texas, MS Energy is a
leading directional drilling services company in the United
States. The pending transaction, which is expected to close
early in the fourth quarter, is subject to customary closing
conditions and receipt of required third party consents, and is
subject to expiration or termination of the waiting period under
the Hart-Scott-Rodino Act.
Founded in 1980, MS Energy has grown to become a leading
provider of directional drilling services in the United
States. With operations in most major producing onshore oil
and gas basins in the United
States, MS Energy provides a comprehensive suite of
directional drilling services including directional drilling,
downhole performance motors, directional surveying, measurement
while drilling ("MWD"), and wireline steering tools.
Mark S. Siegel, Chairman of
Patterson-UTI, commented, "The acquisition of MS Energy will
broaden our service offerings and strengthen our position as a
leading provider of oilfield services in the United States.
Additionally, this transaction increases our exposure to North
American unconventional drilling activity. With the
increasing proportion of pad drilling and the growing number of
horizontal wells per pad, directional drilling is seeing an
increase in demand, even in the vertical section of the wells, as
the well placement is increasingly important to avoid interfering
with other nearby wells."
Andy Hendricks, Patterson-UTI's
Chief Executive Officer, stated, "MS Energy has assembled a strong
group of talented employees and is well known within the industry
for their great reputation in directional drilling services and
high-performance drilling motors. Additionally, they have
differentiated themselves within the directional drilling industry
through a strong focus on technology. MS Energy has
proprietary mud motor, MWD and survey equipment that was designed,
engineered and manufactured in-house. Their
internally-developed and patented Clean Communications
("C2") technology enables high-speed electromagnetic MWD
telemetry independent of geological formation constraints in pad
drilling, which saves E&P companies considerable drilling time
and expense."
Allen R. Neel, Chairman and Chief
Executive Officer of MS Energy, commented, "We look forward to
combining our industry leading directional services and technology
with Patterson-UTI's state of the art drilling rig technology to
enhance Patterson-UTI's position as a leading oilfield services
company." Pursuant to the transaction, Mr. Neel will be
joining Patterson-UTI as President of MS Energy. Mr. Neel has
served as the CEO of MS Energy since 2004 when he co-founded the
company that purchased MS Energy from previous owners. Mr.
Neel has more than 37 years of experience in oilfield services
having worked in the industry since receiving a Bachelor of Science
in Petroleum Engineering from the University
of Alabama.
Also joining Patterson-UTI will be Paul
Culbreth. Mr. Culbreth has served as the COO of MS
Energy since he co-founded the company that purchased MS Energy
from previous owners in 2004. Mr. Culbreth has held various
technical and leadership positions within the oilfield services
industry since 1977.
Under the terms of the transaction, Patterson-UTI will acquire
all of the issued and outstanding limited liability company
interests of MS Energy for consideration of approximately 8.8
million shares of Patterson-UTI common stock and $75 million of cash. In connection with
this transaction, Patterson-UTI expects to acquire approximately
$30 million of non-cash working
capital. The transaction values MS Energy at approximately
$215 million, based on the most
recent closing price of Patterson-UTI common stock of $15.94. Patterson-UTI will fund the
$75 million cash consideration using
cash on hand and the Company's revolving line of credit. The
cash consideration paid to the sellers will be used to cover
transaction expenses and repay the outstanding debt at MS Energy,
and as such, Patterson-UTI will not assume any debt of MS
Energy.
The sellers include Denham Capital Management LP and NGP Energy
Capital Management, L.L.C. and are represented by Simmons &
Company International Energy Specialists of Piper Jaffray.
About Patterson-UTI
Patterson-UTI is an oilfield services company that primarily
owns and operates in the United
States one of the largest fleets of land-based drilling rigs
and a large fleet of pressure pumping equipment. Our contract
drilling business operates in the continental United States and western Canada, and our pressure pumping and oilfield
rental tools businesses operate primarily in Texas and the Mid-Continent and Appalachian
regions. We also provide drilling rig pipe handling
technology to drilling contractors in North America and other select markets.
In addition, we own and invest as a non-operating working interest
owner in oil and natural gas assets that are primarily located in
Texas and New Mexico.
Location information about the Company's drilling rigs and their
individual inventories is available through the Company's website
at www.patenergy.com.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains forward-looking statements
which are protected as forward-looking statements under the Private
Securities Litigation Reform Act of 1995 that are not limited to
historical facts, but reflect Patterson-UTI's current beliefs,
expectations or intentions regarding future events. Words
such as "anticipate," "believe," "budgeted," "continue," "could,"
"estimate," "expect," "intend," "may," "plan," "predict,"
"potential," "project," "pursue," "should," "strategy," "target,"
or "will," and similar expressions are intended to identify such
forward-looking statements. The statements in this press
release that are not historical statements, including statements
regarding Patterson-UTI's future expectations, beliefs, plans,
objectives, financial conditions, assumptions or future events or
performance that are not historical facts, are forward-looking
statements within the meaning of the federal securities laws.
These statements are subject to numerous risks and uncertainties,
many of which are beyond Patterson-UTI's control, which could cause
actual results to differ materially from the results expressed or
implied by the statements. These risks and uncertainties
include, but are not limited to: volatility in customer spending
and in oil and natural gas prices, which could adversely affect
demand for Patterson-UTI's services and their associated effect on
rates, utilization, margins and planned capital expenditures;
global economic conditions; excess availability of land drilling
rigs and pressure pumping equipment, including as a result of low
commodity prices, reactivation or construction; liabilities from
operations; weather; decline in, and ability to realize, backlog;
equipment specialization and new technologies; shortages, delays in
delivery and interruptions of supply of equipment and materials;
ability to hire and retain personnel; loss of, or reduction in
business with, key customers; difficulty with growth and in
integrating acquisitions; governmental regulation; product
liability; legal proceedings; political, economic and social
instability risk; ability to effectively identify and enter new
markets; cybersecurity risk; dependence on our subsidiaries to meet
our long-term debt obligations; variable rate indebtedness risk;
and anti-takeover measures in our charter documents.
Additional information concerning factors that could cause
actual results to differ materially from those in the
forward-looking statements is contained from time to time in
Patterson-UTI's SEC filings. Patterson-UTI's filings may be
obtained by contacting Patterson-UTI or the SEC or through
Patterson-UTI's website at http://www.patenergy.com or through the
SEC's Electronic Data Gathering and Analysis Retrieval System
(EDGAR) at http://www.sec.gov. Patterson-UTI undertakes no
obligation to publicly update or revise any forward-looking
statement.
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SOURCE PATTERSON-UTI ENERGY, INC.