Calgary-based Logan International Inc., a company that manufactures down-hole fishing and intervention tools for the oil and gas industry, has through its U.S. subsidiaries purchased certain assets and operations of the Sup-R-Jar drilling equipment business from Smith International Inc. for C$17.2 million. The transaction is expected to close this month. Logan is a portfolio company of U.S. private equity firm Cadent Energy Partners.
PRESS RELEASE:
Logan International Inc. (TSX:LII) (“Logan” or the “Company”) announced that two of its US wholly owned subsidiaries have entered into an agreement to purchase certain assets and operations of the Sup-R-Jar drilling jar line from Smith International, Inc. Logan, through its wholly-owned subsidiaries, will acquire the majority of Smith International’s North American Sup-R-Jar rental and service assets. In addition, Logan will also receive raw materials and parts inventories, manufacturing specifications and use of the Sup-R-Jar trade name. The purchase price includes the assumption of certain post-closing liabilities and $17.2 million in cash, $15.6 million of which is payable at closing with the remaining $1.6 million payable on delivery of certain inventory items. The transaction is expected to close in early April 2013.
Gerald Hage, Logan Chief Executive Officer, stated, “We believe this acquisition fits very well with our strategy of becoming a leading provider of downhole tools. The North American Sup-R-Jar rental tool and our proprietary Xciter tool are both used by drilling contractors and operators, which Logan believes both improve drilling efficiency especially in horizontal wells. The Sup-R-Jar delivers a sharp blow to the drill string to free stuck drill pipe and to assist the drill string as it turns from a vertical orientation to a horizontal orientation. The Xciter tool increases the drilling rate by introducing a vibration into the drill string thereby reducing well-bore friction. We intend to combine the Xciter and Sup-R-Jar sales, marketing and operations organizations. In addition, Logan Oil Tools, Inc. (“LOT”) will begin manufacturing and selling the Sup-R-Jar to its international customers. In the past, when LOT was requested to submit bids on individual drilling jars and as part of multi-million drilling packages pursuant to international bid tenders, it was unable to respond. Access to the manufacturing specifications and to a well-known drilling jar now allows us to bid on more international work.”
Logan International manufactures and sells a comprehensive line of fishing and intervention tools, including retrieving, surface, stroking and remedial tools for a variety of well workover, intervention, drilling, and completion activities (LOT); manufactures and sells high-performance poly-crystalline diamond compact (PDC) cutters and bearings (Dennis Tool Company); manufactures and sells packers, bridge plugs, and other completion products (Kline Oilfield Equipment, Inc.); provides proprietary multi-zonal completion technology and conventional completion production products and services (Logan Completion Systems Inc.); provides proprietary and patented products and services that are focused on production optimization in sand-laden heavy oil wells (Scope Production Development); and provides proprietary tools that enhance the effectiveness of horizontal drilling (Xtend Energy Services). Common shares of Logan International are traded on the Toronto Stock Exchange (TSX) under the ticker symbol “LII”.
Forward-Looking Statements
This press release contains forward-looking statements, including, without limitation, statements relating to completion and timing of the transaction and the anticipated benefits of the transaction. These statements relate to future events or future performance of Logan International. When used in this press release, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “propose”, “expect”, “potential”, “continue”, and similar expressions, are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties, and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Such statements reflect Logan International’s current views with respect to certain events and are subject to certain risks, uncertainties and assumptions. Although Logan International believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because we can give no assurance that they will prove to be correct. Many factors could cause Logan International’s actual results, performance, or achievements to materially differ from those described in this press release. Readers are referred to Logan International’s Annual Information Form filed on http://www.sedar.comwww.sedar.com which identifies significant risk factors which could cause actual results to differ from those contained in the forward-looking statements. Should one or more risks or uncertainties materialize or should assumptions underlying forward-looking statements prove incorrect, actual results may vary materially from those described in this press release. The forward-looking statements contained in this press release are expressly qualified in their entirety by this cautionary statement. These statements speak only as of the date of this press release. Logan International does not intend and does not assume any obligation, to update these forward-looking statements to reflect new information, subsequent events or otherwise, except as required by law.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities described herein in any jurisdiction.
Contact Information
Logan International Inc.
Gerald Hage
Chief Executive Officer
403-930-6810 Calgary or 832-386-2575 Houston
Logan International Inc.
Larry Keister
Chief Financial Officer
403-930-6810 Calgary or 832-386-2534 Houston
www.loganinternationalinc.com
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