Parker Drilling Puts In Bid for AOG
Parker Drilling Company intends to bid for international land drilling contractor Australian Oil & Gas Corporation Limited. Parker Drilling, through a wholly-owned Australian subsidiary to be formed, will make an offer to shareholders of AOG to purchase all outstanding shares of common stock and listed options as follows:
- Australian $2.50 cash for each AOG share; and
- Australian $1.30 cash for each unexercised AOG listed option.
This bid values AOG at approximately $88 million (Australian $153 million), assuming that all the options are exercised. If successful, Parker would issue common equity in a public offering to finance the acquisition.
The acquisition of AOG would expand Parker's existing international land rig fleet by 28 rigs, to 69 rigs, and its total worldwide rig fleet to 107. It would increase Parker's market presence in its existing Asia Pacific markets of Indonesia and New Zealand. The acquisition would also provide Parker with entry into the markets of Oman and Australia. AOG also has rigs in Argentina and Libya.
"AOG fits well with our strategic plan to expand international operations into areas where we anticipate significant growth in the future," said Robert L. Parker Jr., president and chief executive officer. "We are pleased with the quality of the AOG management team, their operations and equipment, and we anticipate a smooth process of incorporating them into Parker Drilling."
Both the offer for AOG shares and listed options will be subject to the following conditions:
- Australian Foreign Investment Review Board approval, and
- Certain prescribed occurrences as provided under the Australian Corporations Act.