(WO) – Patterson-UTI Energy, Inc. has entered into a definitive agreement to acquire Ulterra Drilling Technologies, L.P., a global provider of specialized drill bit solutions, for consideration of $370 million of cash and 34.9 million shares of Patterson-UTI common stock.
Founded in 2005 and headquartered in Fort Worth, Texas, privately-owned Ulterra designs, manufactures, sells and rents PDC drill bits. With a global footprint, Ulterra supports customers in over 30 countries with sales, manufacturing, and repair facilities throughout North and South America, the Middle East, and Asia. In North America, Ulterra is a leading provider of PDC drill bits, with operations across the most active basins in the United States and Canada.
Andy Hendricks, Chief Executive Officer of Patterson-UTI, commented, "Both Patterson-UTI and Ulterra share a culture of innovation and a focus on superior service quality, building deep and highly collaborative relationships with customers. Ulterra's industry leading position in the North American PDC drill bit market will expand our operational and technology portfolio and strengthen our position as a leading drilling and completions company. The addition of Ulterra to our drilling offering and our recent announcement to merge with NexTier Oilfield Solutions advances our strategy to enhance our positions in both drilling and completions, areas where Patterson-UTI has a strong 45-year history of operations and innovation."
Mike Holcomb, Patterson-UTI's Chief Operating Officer, added, "Ulterra's growing Middle East presence will broaden our geographic footprint and provide strong relationships with key customers in this international market. Additionally, Ulterra's data-centric approach to manufacturing, operations, and marketing has been key to their success in the PDC drill bit business. Their proprietary BitHub data platform is complementary to our PTEN+ data platform and will further expand our comprehensive data analytics capabilities from the drill bit to the well completion. When you consider the combination of data systems from Patterson-UTI, NexTier and Ulterra, we believe we will have the most comprehensive set of data for drilling and completions across the United States, which through our analytics capabilities can allow us to better support our customers' objectives to improve well productivity."
Mr. Holcomb further stated, "For the full year 2023, we expect Ulterra to generate between $160 and $180 million of EBITDA. We also expect to begin generating revenue synergies within the first year."
John Clunan, President and Chief Executive Officer of Ulterra, stated, "Our data-driven approach to industry-leading drill bit engineering and innovation, along with strong customer relationships, aligns well with Patterson-UTI's engineering and operational success. We are excited about the potential to add our leading drill bit technologies to Patterson-UTI's portfolio of drilling rigs, directional drilling services, controls automation and well placement technologies to better support our customers' efforts to drill better wells." Mr. Clunan has more than 26 years of experience in the drilling business and has been with Ulterra since 2008.
The Ulterra business will continue to operate under the name Ulterra, and its headquarters will remain in Fort Worth, Texas.
