Superior swings $200M acquisition of Warrior Energy Services
New Orleans CityBusiness, Oct 6, 2006 by Jaime Guillet
Diversification into inland markets is behind the estimated $200 million acquisition of Houston-based Warrior Energy Services Corp. by Superior Energy Services Inc.
Superior Energy Services, which provides specialized oilfield services and equipment, signed the definitive merger agreement to acquire Warrior's 25 operating bases in 10 states for approximately $175 million in cash and 5.3 million shares of common stock. The acquisition of the natural gas and oil well service company is scheduled to close in the fourth quarter.
The acquisition diversifies Superior's revenue and income stream to be less dependent on the Gulf of Mexico and expands into the inland markets, said Greg Rosenstein, vice president of investor relations for Superior.
"(The diversification into land markets) will mitigate the seasonality of primarily working in the Gulf (but) we have been diversifying for several years," said Rosenstein. "It's part of our strategy."
Superior is backed by a $200-million long-term debt commitment through a Term B credit facility in connection with the Warrior transaction. The transaction is expected to increase Superior's non- Gulf of Mexico total services and rental revenue from 43 percent to 50 percent in 2007. Superior will gain 570 skilled laborers in addition to Warrior's management team. No positions will be terminated through the merger, Rosenstein said.
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