Patterson-UTI to buy Pioneer Energy Services for $295m

US-based oilfield services provider Patterson-UTI Energy has agreed to acquire Pioneer Energy Services in a cash-stock deal worth around $295m.

Patterson-UTI will pay for the deal through the issuance of up to 26,275,000 shares of its common stock and $30m in cash.

The transaction also involves the retirement of all Pioneer debt.

With the acquisition, Patterson-UTI will expand its current fleet of 150 super-spec drilling rigs in the US by an additional 16 rigs.

The deal will also expand the geographic footprint of the oilfield services firm into the international markets with the addition of eight pad-capable rigs in Colombia.

Patterson-UTI CEO Andy Hendricks called Pioneer’s fleet of 17 drilling rigs in the US a ‘valuable’ addition to its business.

Hendricks added: “Additionally, many of these rigs are capable of substituting cleaner-burning natural gas for diesel, a technology that is becoming increasingly important to operators for reduced emissions.”

Planned to be completed in the fourth quarter of this year, the transaction awaits the approval of regulators and Pioneer stockholders.

Patterson-UTI said that the acquisition will enable it to improve its focus on reduced emissions.

Patterson-UTI said in a press statement: “Patterson-UTI believes this business would be better served as part of a larger well service rig business or as a focused standalone business. Accordingly, Patterson-UTI expects that this well service rig business would be divested following the closing of the transaction.”

Pioneer operates the US and Colombian contract drilling businesses along with a well service rig business comprising 123 service rigs in the Gulf Coast region.