|Monday, October 11, 1999
National-Oilwell, Inc. (NOI/NYSE) and Hitec ASA (OSE/HIT) jointly announced today the signing of a definitive agreement that will create the industryâ€™s leading integrated drilling solutions company. The agreement, which has been approved by both companiesâ€™ boards of directors, provides for the issuance of 8 million National Oilwell common shares and NOK 148.7 million (approximately U.S. $20 million) in exchange for all of the outstanding shares of Hitec ASA. Each Hitec share can be exchanged for .21259 of a National Oilwell share plus NOK 3.9515 (approximately U.S. $0.50). Immediately prior to the close of the transaction, Hitec will sell its non-drilling related businesses to a new company for NOK 148.7 million. Each Hitec shareholder will have the right to participate in the new company. The transaction, which will be accounted for as a purchase, has a current value of approximately $125 million. Jon Gjedebo, Hitecâ€™s President and CEO, will join National Oilwellâ€™s board of directors and senior management team, serving as the companyâ€™s Executive Vice President and Chief Technology Officer. Joel V. Staff, National Oilwellâ€™s Chairman, President and CEO, said â€œThis combination creates short- and long-term shareholder and customer value by placing National Oilwell in an unparalleled position to deliver fully integrated drilling and well servicing solutions. Bringing together Hitec, the leading provider of integrated control systems, and National Oilwell, the leading provider of equipment and components for high performance drilling systems, creates the potential for development of a new generation of drilling machinery. Hitecâ€™s control, instrumentation and pipe handling systems significantly enhance National Oilwellâ€™s product offering. Additionally, we are extremely excited about the vision and innovation Jon Gjedebo will bring to National Oilwellâ€™s board of directors and management team.â€ Jon Gjedebo, President and Chief Executive Officer of Hitec, said â€œNational Oilwellâ€™s market leading position and worldwide installed base will allow Hitec to grow our existing drilling business more quickly than we could on our own. Our August 1998 cooperative agreement with National Oilwell resulted in the delivery of the industryâ€™s first active heave compensating drawworks, which has performed beyond our customersâ€™ expectations and been enthusiastically received by the industry. The merger will increase our ability to develop and successfully market new products, as well as enhance the efficiency and safety of both companiesâ€™ existing products.â€ The transaction is subject to various conditions, including certain regulatory approvals, the effective registration of the related National Oilwell common shares and the approval of Hitecâ€™s shareholders. A group of Hitecâ€™s key shareholders, collectively owning approximately 40% of Hitecâ€™s shares, have agreed to vote for the transaction, which is anticipated to close by the end of the year. Merrill Lynch & Co. acted as financial advisor to National Oilwell and First Securities ASA acted as financial advisor to Hitec. National-Oilwell is a worldwide leader in the design, manufacture and sale of machinery, equipment and downhole tools used in oil and gas drilling and production, as well as in the distribution to the oil and gas industry of maintenance, repair and operating products. Hitec is a leading supplier of highly advanced systems and solutions for the oil and gas industry. Its leading-edge automation and remote control technologies are applied within oil and gas drilling, offshore oil and gas production and transport, and remote operated subsea construction and maintenance. Statements made in this press release that are forward-looking in nature are intended to be "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934 and may involve risks and uncertainties. These statements may differ materially from actual future events or results. Readers are referred to documents filed by National Oilwell with the Securities and Exchange Commission, including the Annual Report on Form 10-K, which identify significant risk factors which could cause actual results to differ from those contained in the forward-looking statements.