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Patterson-UTI Energy signs definitive merger agreement with Seventy Seven Energy.

International Resource News-December 13, 2016--Patterson-UTI Energy signs definitive merger agreement with Seventy Seven Energy

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International Resource News - 13 December 2016

Patterson-UTI Energy Incorporation (NASDAQ: PTEN), a provider of contract drilling and pressure pumping services in North America, has signed a definitive merger agreement with Seventy Seven Energy Incorporated (OTCPK:SVNT), a company that provides contract drilling, pressure pumping, and oilfield rentals in many of the most active oil and natural gas plays onshore in the United States.

The contract has been signed, based on which Patterson-UTI will acquire Seventy Seven Energy in an all-stock transaction.

According to the terms of the transaction, Patterson-UTI will acquire all of the issued and outstanding shares of common stock of Seventy Seven Energy, in exchange for approximately 49.6 million shares of common stock of Patterson-UTI. The aggregate number of shares of Patterson-UTI common stock is subject to downward adjustment if certain in-the-money Seventy Seven Energy warrants are forfeited or exercised on a net-share basis. The transaction values Seventy Seven Energy at around USD1.76bn, assuming the issuance of 49.6 million shares of Patterson-UTI common stock at today's closing price of USD28.67, plus approximately USD336m of Seventy Seven Energy's debt net of cash and warrant proceeds. All of Seventy Seven Energy's debt is likely to be repaid at the closing of the transaction. Based on the number of shares of Seventy Seven Energy common stock expected to be outstanding or deemed outstanding as of the closing date, and assuming that the in-the-money Seventy Seven Energy warrants are exercised for cash, the exchange ratio would be approximately 1.7725 shares of Patterson-UTI common stock for each share of Seventy Seven Energy common stock, and shareholders of Seventy Seven Energy are to own around 25 percent of the combined company.

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Publication:International Resource News (IRN)
Date:Dec 13, 2016
Words:325
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