Patterson-UTI Energy Inc. and NexTier Oilfield Solutions Inc. are officially one company after completing a merger that creates a single oilfield service provider valued at $5.4 billion, the companies said on Sept. 1.
The combination creates a leading provider of drilling and completions services in the U.S., Patterson-UTI said. The combined company will retain the name Patterson-UTI, continue trading under the ticker symbol PTEN and maintain its headquarters in Houston.
Patterson-UTI said it offers the “most comprehensive set of drilling and completions operational data” in the U.S., including a contract drilling business fleet with 172 super-spec drilling rigs. Its well completions business, which will operate under the NexTier Completions brand, offers 3.3 million hydraulic fracturing horsepower.
Patterson-UTI President and CEO Andy Hendricks said the merger establishes the company as a leading technology-driven drilling and well completions business.
“The company is well positioned to deliver value through our comprehensive portfolio, innovative offerings, significant free cash flow generation and strong financial position,” he said. “With an outstanding combined team and collective track record of integrations, we are confident we will hit the ground running and successfully bring the businesses together. We look forward to welcoming our NexTier colleagues and starting this new chapter together."
The company also expects the transaction to be accretive to earnings per share and free cash flow in 2024. Anticipated annual cost savings and operational synergies will total approximately $200 million within 18 months following the closing of the deal.
“Patterson-UTI intends to target high free cash flow conversion, remain good stewards of capital and continue its practice of targeting a return of 50% of free cash flow to shareholders,” the company said in a press release.
In addition to Hendricks role as president and CEO, the company’s leadership team will be comprised of:
- Andy Smith, CFO;
- Mike Holcomb, chief business officer;
- Matt Gillard, NexTier Completion Solutions president;
- Ken Berns, chief commercial officer;
- Seth Wexler, general counsel and secretary; and
- Kenny Pucheu, chief integration officer.
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