By August 15, 2017 Read More →

Calgary-based oil rig maker TESCO Corp. sold to USA competitor Nabors Industries

Source: Tesco Corporation

Transaction values TESCO common stock at $4.62 per share

Tesco Corporation announced it entered an agreement Nabors Industries Ltd. to combine with Nabors in a stock-for-stock transaction, according to a press release.

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TESCO shareholders will be issued 0.68 common shares of Nabors for each outstanding share of common stock of TESCO. TESCO shareholders will own approximately 10 per cent of the outstanding shares of Nabors.

“With this transaction, TESCO will now have an expanded platform, which will allow for acceleration of its strategy and increase the potential for market share gains around key industry trends,” said Michael W. Sutherlin, TESCO’s board of directors chair.

“The combination will provide significant value to TESCO shareholders by participating in a stronger and broader offering of complementary rig equipment product lines and tubular services.”

The transaction was approved by the board of directors of both companies and is subject to approval by TESCO security holders and satisfaction of customary closing conditions and regulatory approvals.

This transaction values TESCO common stock at $4.62 per share based on Nabors closing share price of $6.80 on the New York Stock Exchange on Aug. 11, 2017.

“The addition of TESCO to our company represents another step forward for both our rig equipment and Nabors Drilling Solutions business.  TESCO is respected for the quality of their product offerings and aftermarket service levels.  I am eager to realize the benefits to our combined customers and shareholder groups that this combination will provide,” said Nabors’ Chairman, President and Chief Executive Officer Anthony G. Petrello.

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This represents a premium of 19 per cent to TESCO’s closing price on the NASDAQ Stock Market on the same date, and represents a premium of 30 per cent to TESCO’s enterprise value based on TESCO’s June 30, 2017 cash balance.

“This is a very exciting opportunity to combine two world class companies that are highly focused on delivering best in class services to the oil and gas industry,” said TESCO CEO Fernando Assing.

“This combination will further reinforce Nabors position as a leading rig equipment and drilling automation provider by integrating TESCO’s advanced tubular services technology and products into the Nabors global rig footprint and NDS services. The new expanded platform also creates significant career opportunities for TESCO’s employees as part of a much larger international organization.”

Posted in: Energy Financial

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