Scottish upstream operator Weir Group plc is extending its reach into North America’s unconventional natural gas and oil fields with a deal to acquire Houston-based Seaboard Holdings Inc. for $675 million.

The transaction would complement Weir’s existing wellhead pressure control business in the United States and Canada, which has been struggling to match supply with demand for its pumps and related drilling equipment used by onshore operators. Weir already was planning to expand its manufacturing capacity in Texas and Canada.

CEO Keith Cochrane had acknowledged during a recent conference call that Weir was working to fulfill several months of orders for kits used in hydraulic fracturing (fracking) operations.

Seaboard’s range of high-end surface equipment is “directly adjacent” to Weir’s “market leading portfolio of frack pumps and other well completion equipment,” he said. Seaboard is “a company we have been tracking for some time” to extend scale in “frack rental,” as well as the conventional drilling market. The transaction’s price is at “a similar multiple to what you have seen in this sector over the last several months.”

In 2007 Weir acquired SPM Flow Control, which gave it an opening as a large supplier to upstream companies in North America using fracking techniques. This past August demand for Weir’s fracking equipment in North America led the company to up its forecast for 2011 profits.

Cochrane said, “Today capacity is still our No. 1 challenge — addressing that challenge is our No. 1 priority.”

Seaboard employs around 400 people in 20 locations mostly in North America. The company is expected to generate around $200 million this year after completing its acquisition of a Canadian wellhead parts distributor. Seaboard generated earnings of $34 million on sales of $163 million in 2010.

Weir plans to fund the acquisition with debt. The purchase is expected to be accretive to earnings immediately, and post-tax returns are expected to exceed Weir’s cost of capital by 2014. Weir is paying about 11.64 times earnings.

“We are confident that the extended market opportunities and medium-term operational benefits will create significant value,” said Cochrane. The company retains the “financial flexibility to pursue organic growth initiatives and further acquisition opportunities.”