Recently, Nabors Industries acquired Tesco Corp. The stock-for-stock deal will help Nabors Industries expand its automated drilling arm and global rig equipment. Nabors Industries is the biggest land-based rig fleet for drilling in the world. Eventually, Canrig will combine its services with the complementary rig equipment manufacturing operations of Tesco. Also, aftermarket services and rentals will be combined. The global tubular services owned by Tesco will be especially helpful to Nabors Industries.
The deal is worth about $215 million and will be finalized around the end of 2017.
Acquiring Tesco As A Strategic Move
Tony Petrello, CEO of Nabors Industries, has said that adding Tesco to the company is a smart move for the future of Nabors Industries. Adding that it will benefit drilling and rig equipment operations immensely. Petrello pointed out that Tesco has maintained a strong reputation for quality products and aftermarket services for many years. He was excited to discover even more benefits of combining shareholder and customer groups.
With complementary products being combined with technologies and tools, Nabors Industries can give its customers more personalized and applied solutions. Also, the company will be able to enhance its efficiency with all levels of operations. Nabors Industries can scale development and accelerate it, and Petrello said that older rig equipment will be upgraded.
A Tesco chairman said that the transaction will leave Tesco with a new platform that allows quicker strategy acceleration. It will boost the market potential among several important trends. Also, the chairman pointed out that the transaction will leave Tesco’s shareholders with a better value because of the wider range of tubular services and equipment offerings.
A Step Up For Both Companies
Fernando Assing, CEO at Tesco, said in an interview that the transaction will combine services and products and will strengthen the position of Nabors Industries as a leader in drilling and rig equipment. The acquisition will also create new jobs and promotions for current Tesco employees. In 2016, Tony Petrello suggested a strategy during the annual analyst day. The recent deal helps bring Petrello’s plan to boost his company’s expertise to life. In the earlier part of 2017, Weatherford International and Nabors Industries agreed to operate jointly with their natural gas drilling and enhanced oil services for customers in the contiguous United States.
In the combined work effort, Nabors Industries contributed a powerful fleet of MPD-ready rigs, automated equipment, drilling software programs and proprietary control systems. It also contributed systems that are optimized for land, and they measure while they are drilling. Weatherford contributed managed pressure drilling solutions, software programs, well construction advising and talented engineers.
In another interview, Tony Petrello said that the drilling rig will also be used in the distant future. With integrated services, he said that the recent combined project substantiated his strategies. Additionally, Petrello said that Nabors Industries was ready to use Tesco’s premium tools and automated programs around the world. Projections show that the first-year operating synergies of Nabors Industries and Tesco will be around $20 million. When they reach their full potential, Petrello said that the operating synergies will be as high as $35 million. He also expects to see capital savings from strategic use of the facilities of both companies.
Tony Petrello Dedicated to Smart Energy Solutions
Tony Petrello is excited to welcome Tesco’s respected management personnel to Nabors Industries. He was enthusiastic about the professionals delivering benefits from the combined efforts of both companies to shareholders and customers. Each board approved the transaction earlier this year. In addition to providing strategic planning, Tony Petrello is responsible for coordinating major operating functions. His adaptive strategies allow the company to prosper in a competitive and ever-changing environment, while helping to promote smarter energy solutions.
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