April 22, 2013
Parker Drilling Company
(NYSE-PKD), an international drilling contractor and drilling services and rental tools provider, announced today the acquisition of International Tubular Services Limited and certain affiliates (ITS), subsidiaries of ITS Tubular Services (Holdings) Limited, a privately held international rental tools and well services company. In line with Parker's strategic goal to offer additional integrated products, services and expertise to international energy exploration and production (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
. 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
, U.K. and
, and the
region. Under the terms of the agreement, Parker paid
for ITS. An initial purchase price of
was paid at the closing and an additional
was deposited into an escrow account, which will either be paid to ITS Tubular Services (Holdings) Limited as additional purchase price when certain consents are obtained or, in certain circumstances, released to Parker. The transaction was financed with a
term loan provided by Goldman Sachs Bank USA.
"Today we are further investing in a business segment we know well and an international rental tools growth strategy that we've focused on for some time," said
, president and chief executive officer of
. "ITS is one of the industry's leading independent international rental tools and well service companies with a broad footprint and a strong portfolio of products and service capabilities. By expanding our geographic presence and services offering, we are positioning ourselves to better serve the growing needs of international E&P operators and drilling contractors."
, previously chief executive officer of International Tubular Services (Holdings) Limited and now vice president of Parker's International Rental Tools business unit, commented, "This is an exciting combination. With the support of Parker, ITS is now in a better condition to provide the best solutions for our customers. As part of Parker, a company with a respected reputation, financial strength, process discipline and dedication to people, we expect to continue to grow our ability to deliver premier rental tools services on a global scale."
"This acquisition creates immediate advantages for Parker," Mr. Rich said. "It increases our geographic and product line diversity and enhances our ability to deliver innovative, reliable and efficient results to our customers. We are confident this transaction will provide attractive financial returns and compelling cost and tax benefits that will improve profitability and drive increased value for our shareholders."