Nabors Industries to Acquire Pool Energy Services for $518 Million
Nabors Industries, Inc. and Pool Energy Services Co. today announced that the boards of directors of both companies have unanimously approved a definitive merger agreement for a tax-free, stock-for-stock transaction that will be accounted for using the purchase method of accounting. Under the agreement, Pool shareholders will receive 1.025 shares of Nabors common stock for each share of Pool they currently own. This transaction implies a value of $16.46 per Pool share based on Nabors' closing stock price of $16.06 on January 8, 1999, and a total value of approximately $518 million, including $144 million in assumed net debt.
The combined entity will operate approximately 440 land drilling and 750 workover/well-servicing rigs in North America, 100 drilling and workover rigs internationally, and 60 offshore rigs both domestically and internationally. Combined pre-merger revenues for the 12 months ending September 30, 1998 were $1.6 billion with operating income of $279 million.
Eugene Isenberg, chairman and chief executive officer of Nabors, said, "We are very pleased to have concluded an agreement with Pool. Pool has a loyal and committed workforce, which will be a great complement to our own employee base. The current reduced activity levels and uncertainty of tomorrow's market environment makes this combination particularly timely and beneficial. Our agreement provides a substantial premium to Pool's shareholders and the all stock consideration enables us to maintain a conservative financial structure."
Isenberg added, "Pool and Nabors are a good fit. The combined entity will enjoy a broader geographic presence in land and offshore operations, both domestically and internationally. Likewise, Pool's shareholders will benefit from a much larger exposure to land drilling operations in Canada and the U.S. Lower 48."
The merger is expected to close in the second quarter of 1999.
Nabors actively markets over 400 land drilling rigs worldwide. Offshore, the Company operates 25 platform rigs, six jack-ups and two barge drilling rigs. The Company participates in most of the significant oil, gas and geothermal drilling markets in the world. Nabors also manufactures top drives and drilling instrumentation systems and provides comprehensive oilfield engineering, civil construction, logistics and facility maintenance and project management services.