Western Lakota Acquires Coil Rig Company
Western Lakota Energy Services has closed the acquisition of Command Coil Services Inc. ("Command"). Command currently owns two coil service rigs and is in the process of building three additional units. The rigs are currently working for customers in western Canada and have a full complement of crews. This sale is considered a related party transaction as a director of Western Lakota is also a director and majority shareholder of Command.
The purchase price of $2.1 million, which was equivalent to 1.8 times expected 2006 EBITDA, was paid by the issuance of 168,800 common shares of Western Lakota Energy Services Inc. at a deemed issue price of $12.50 per share. Western Lakota is also assuming a net debt position of $2,916,711.
Doug Zimmer, who has extensive experience in managing coil service rigs, will remain the General Manager of Command. The Company believes that this segment of the energy services industry represents a significant area for future growth.
One of Canada's fastest-growing energy services providers, Western Lakota is currently operating 32 drilling rigs, including six surface casing/core drilling rigs and has committed to build 24 more rigs that are scheduled to be completed throughout 2006 and early 2007. Upon completion of this transaction, the Company now also operates two coil service rigs with an additional three scheduled to be completed by early 2006. Western Lakota continues to provide one of the newest fleets of safe and efficient drilling rigs and coil service rigs in Canada while delivering strong results for shareholders, customers and Aboriginal partners.
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Company: Command Coil Services more info
- Western Lakota Acquires Coil Rig Company (Nov 29)