Scotland-based oilfield services provider The Weir Group plc continues to expand its U.S. onshore holdings, the latest deal being the acquisition of Oklahoma’s Mathena Inc.
Initially Weir would pay $240 million for the company, with deferred payments of up to $145 million over two years, “contingent upon meeting profit growth targets.”
The El Reno, OK, operator provides pressure control rental equipment and services for onshore oil and gas drillers, supported by 12 service facilities in unconventional U.S. basins. The company was founded in 1960 by Harold Mathena, and entities are controlled by the family.
“Mathena is a well regarded business in the U.S. upstream oil and gas markets, with a strong management team and market share in the pressure control drilling markets,” said Weir CEO Keith Cochrane. “This deal is a close strategic fit with our existing pressure control business and gives us a larger suite of products which we can sell to the expanded customer base. The business has strong growth potential and increases our exposure to shale oil and gas, markets with attractive long term structural growth prospects.”
Mathena products assist in controlling, separating and venting abnormal pressures from the well bore during the drilling process. It manufactures a range of pressure control products including hydraulic chokes, mud-gas and shale-gas separators. The acquisition will increase the aftermarket focus of unit Weir Oil & Gas with about 80% of Mathena’s revenues generated from equipment rental and 20% from related parts and service.
Mathena’s gross assets at the end of 2011 were $75 million, with 2011 profits of $46 million before taxes. Based on 4Q2012 estimates, Mathena’s annualized earnings in 2012 are to be $49 million before taxes.
Mathena is expected to accelerate Weir’s strategy to become a top U.S. provider of surface pressure control equipment and services to upstream onshore unconventional markets.
In January Weir struck a $176 million deal to acquire onshore oilfield services operator Dallas-based Novatech LLC (see Shale Daily, Jan. 27). Two months earlier Weir paid $675 million to buy Houston’s Seaboard Holdings Inc., which extended its reach in the pressure pumping rental market and basically doubled its share of the global pressure pumping surface equipment market to nearly 10% (see Shale Daily, Nov. 29, 2011).
The Mathena management team is to remain with the business once the transaction closes, which is expected by the end of the month.
By merging with Weir, Mathena will be able to “continue to develop as a business committed to innovation and service in one of the world’s most exciting energy markets,” said CEO John Mathena.
© 2022 Natural Gas Intelligence. All rights reserved.
ISSN © 2577-9877 | ISSN © 2158-8023 |