Trican Well Service Ltd. is pleased to announce that it has reached an agreement to acquire the assets of a private U.S.-based company that provides stimulation services used in the development and completion of oil and gas wells in Oklahoma, Texas and Arkansas.

Under the terms of the agreement, Trican will acquire 100% of the assets of the private company through its wholly-owned US subsidiary, Trican Well Service, L.P. formerly Liberty Pressure Pumping, L.P., in exchange for cash consideration of US$46.0 million. Funding for the acquisition is made up of existing cash and bank financing. In addition, Trican will assume indebtedness on asset leases of approximately US$3.4 million. The transaction will be effective today.

The acquired assets, which were put into service mid-2008, consist of 56,250 horsepower (HP) fracturing capacity and the necessary ancillary equipment to operate two fracturing crews. In addition, the Company acquired two acidizing pumpers and ancillary equipment, and an established base of operations in Shawnee, Oklahoma, which includes some rail assets. This transaction brings Trican’s worldwide fracturing fleet to 515,850 HP and will increase the U.S. fleet to 267,750 HP. Based on the allocation of the cash consideration and assumed debt to the fracturing assets acquired, Trican estimates the cost of the acquisition to be approximately US$773 per unit of HP.

Trican intends to integrate the acquired equipment into its current U.S. fleet and operate out of the acquired base in Shawnee, Oklahoma, providing another base from which to service customers active in the Woodford Shale.

Despite some very challenging market conditions for most of 2009, Trican’s U.S. Operation positioned itself well in some of the most active shale plays. Activity has recently rebounded in these regions which has had a positive impact on equipment utilization and operating margins. This additional equipment will help Trican meet the increasing demand for services from its customers.

Trican is committed to growing its geographic presence and service offering in the U.S., and believes that this acquisition will make a significant contribution to this long-term strategy. Currently, demand for Trican’s services in the U.S. is robust, and if market activity continues to increase, the additional equipment acquired will situate Trican in a strong position to meet the anticipated growth in demand for 2010 and beyond.

Macquarie Capital (USA), Inc. advised Trican on this acquisition.

Source: Marketwire

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