Patterson-UTI to acquire MS Energy Services for $215m
Oilfield services firm Patterson-UTI Energy has signed an agreement to acquire US-based directional drilling services company Multi-Shot, currently trading as MS Energy Services, in a deal valued at $215m.
Under the agreement, Patterson-UTI will offer around 8.8 million shares of common stock and $75m of cash.
Through the proposed transaction, which is expected to conclude in the fourth quarter of this year, Patterson-UTI aims to enhance its exposure to North American unconventional drilling activity.
Patterson-UTI Energy chairman Mark Siegel said: "The acquisition of MS Energy will broaden our service offerings and strengthen our position as a leading provider of oilfield services in the US.
“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."
Established in 1980, MS Energy’s services include directional drilling, downhole performance motors, directional surveying, measurement while drilling (MWD), and wireline steering tools.
The completion of the acquisition is dependent on the fulfilment of customary closing conditions and receipt of third party approvals.
The acquisition agreement also allows Patterson-UTI to acquire non-cash working capital worth around $30m.
MS Energy will use the sale proceeds to repay its outstanding debt and to cover transaction expenses.
In addition to contract drilling services, Patterson-UTI operates pressure pumping and oilfield rental tools businesses in Texas and the Mid-Continent and Appalachian regions.
The company also owns non-operating working interests in oil and natural gas assets based in Texas and New Mexico.