Allis-Chalmers closes deal for DLS Drilling
Tuesday, August 15th 2006
Allis-Chalmers Energy Inc. has acquired DLS Drilling Logistics and Services Corp., an Argentinian oilfield services company, in a deal with a total value of about $105 million.
The seller was Bridas International Holdings Ltd., Bridas Central Co. Ltd. and Associated Petroleum Investors Ltd.
The purchase price included $93.7 million in cash, 2.5 million newly issued shares of Allis-Chalmers’ common stock and about $8.6 million of assumed debt.
Headquartered in Buenos Aires, DLS is a provider of services for drilling, workover/completion and repair of oil and gas wells in Argentina and Bolivia.
With more than 1,500 employees, DLS currently operates a fleet of 51 rigs, including 21 drilling rigs, 18 workover rigs and 12 pulling rigs in all major basins in Argentina and Bolivia.
“We plan to grow DLS’ strong South American drilling business and to capitalize on its oilfield market presence,” Allis-Chalmers’ Chairman and CEO Micki Hidayatallah said in a statement.
DLS estimates second-quarter revenue of $43 million and earnings of $8.4 million.
As part of the acquisition, Alejandro Pedro Bulgheroni and Carlos Alberto Bulgheroni joined the Allis-Chalmers board of directors, filling vacancies created by the resignations of Jens H. Mortensen Jr. and Thomas O. Whitener Jr.
RBC Capital Markets acted as financial advisor to Houston-based Allis-Chalmers (Amex: ALY) and Simmons & Co. International of Houston advised the sellers.
