Parker Drilling Acquires International Tubular Services
Acquired International Tubular Services Ltd. and certain affiliates (ITS), subsidiaries of ITS Tubular Services (Holdings) Ltd., a privately held international rental tools and well services company.
Parker Drilling Co. (NYSE: PKD) has acquired International Tubular Services Ltd. and certain affiliates (ITS), subsidiaries of ITS Tubular Services (Holdings) Ltd., a privately held international rental tools and well services company.
Under the terms of the agreement, Parker paid US $125 million for ITS. An initial purchase price of US $101 million was paid at the closing and an additional US $24 million was deposited into an escrow account, which will either be paid to ITS Tubular Services (Holdings) Ltd. as additional purchase price when certain consents are obtained or, in certain circumstances, released to Parker. The transaction was financed with a US $125 million term loan provided by Goldman Sachs Bank USA.
In line with Parker's strategic goal to offer additional integrated products, services and expertise to international energy E&P operators and drilling contractors, the acquisition significantly expands Parker's Rental Tools business to include ITS' strong customer base in growing international markets and additional well services. The business combination also creates opportunities to increase financial performance by leveraging operating costs and realizing tax benefits.
ITS is a leading independent provider of rental tools and well services with 2012 annual revenues of US $119 million. Principal activities are renting drilling tubulars and pressure control equipment and providing casing running and fishing services. ITS serves an extensive customer base of E&P companies, drilling contractors and service companies from 22 operating facilities primarily located in the Middle East, Latin America, UK and Europe, and the Asia-Pacific region.
Joe Chandler, who served as CEO of International Tubular Services (Holdings) Ltd., was appointed vice president of Parker's international rental tools business unit.
Goldman, Sachs & Co. was financial advisor. Ernst &Young LLP provided advisory services. Baker Botts LLP was Parker's legal advisor.
Parker Drilling Co., together with its subsidiaries, provides contract drilling and drilling-related services. The company is headquartered in Houston.