Allis-Chalmers Energy Completes Acquisition of Specialty Rental Tools
Allis-Chalmers Energy has completed the purchase of Specialty Rental Tools, Inc. (Specialty), based in Lafayette, Louisiana. Since 1978, Specialty has developed a strong reputation and solid customer base by renting high quality drill pipe, heavy weight spiral drill pipe, tubing work strings, blow- out preventers, choke manifolds and various valves and handling tools for oil and natural gas drilling.
During the nine months ended September 30, 2005, Specialty generated aggregate revenues of $21.8 million and EBITDA of $16.2 million. EBITDA is a financial measure that is derived on the basis of methodologies other than in accordance with generally accepted accounting principles, or GAAP. Additional information and discussion regarding EBITDA is provided later in this release.
Micki Hidayatallah, Allis-Chalmers' Chairman and Chief Executive Officer stated, "We are extremely excited that we have completed the acquisition of Specialty Rental Tools. It has an inventory of premium rental tools with a fair market value in excess of $100 million, which substantially increases the range and quality of rental tool products that Allis-Chalmers can offer its customers. Allis-Chalmers intends to deploy the Specialty Rental fleet across its 25 strategically situated operating locations in both the domestic US and Mexico markets, thereby increasing its exposure to the more than 300 independent and multinational exploration and production company customers that the Company currently serves. It is our intention to substantially increase capacity utilization of the Specialty Rental fleet and benefit from the very high EBITDA contribution that the incremental revenue dollar generates. Most importantly, we are very pleased that Joe Van Matre, the founder and sole shareholder of Specialty will be joining the Allis-Chalmers management team and contributing to the execution of all our growth strategies."
On a pro forma basis after giving effect to the acquisition, for the nine
months ended September 30, 2005, the Company's rental tools segment would have
constituted approximately 55.0% of its EBITDA.
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Company: Specialty Rental Tools more info
- Allis-Chalmers Energy Completes Acquisition of Specialty Rental Tools (Jan 19)