Tesco Corporation has acquired all of the assets and ongoing business of Bo Gray Casing and A&M Tubular Maintenance ("Bo Gray") from The Catalyst Group, Inc. of Houston, Texas and its affiliate partners. Bo Gray is a casing and tubing running company operating in East Texas and North Louisiana. Consideration for this acquisition was US$10.5 million paid on closing with approximately US $0.5 million in assumed trade liabilities and up to an additional US$5.5 million payable out of continuing operations over the next three years based on Bo Gray's performance. In 2001 Bo Gray generated revenues of US$20 million while 2002 revenues are expected to be US$12.6 million reflecting current industry conditions.
With this acquisition, Tesco has executed an important element of its corporate strategy announced in June 2002 to acquire a platform to introduce its proprietary Casing Assist Running System ("CARS"(TM) ) developed from its innovative Casing Drilling(TM) technology. Tesco plans to leverage Bo Gray's considerable industry expertise and dominance in its regional markets to launch this new technology in land markets in preparation for entering the offshore market.