Energy company Patterson-UTI Energy (PTEN) entered into an agreement to purchase pressure-pumping and wire-line assets from Key Energy Services (KEG) for approximately $240 million.
As part of the terms of the deal, Patterson will purchase equipment from Key subsidiaries to add to the company’s total horsepower in its pressure-pumping gear along with a 26-unit wireline business. Both assets are used in oil shale drilling, which is a technology for the extraction of oil from non-traditional materials.
The equipment is located in the Barnett Shale, Eagle Ford Shale and Permian Basin regions, the company said.
The all-cash transaction will be funded through an expanded credit facility, the company said.
"This acquisition significantly expands one of our core businesses, increasing its geographic footprint and overall capabilities,” Mark Siegel, Patterson-UTI's Chairman, said in a statement. "We are very pleased to be able to accelerate the growth of our energy service businesses."
Shares of Patterson were up 6.7% to $13.80 on Tuesday while Key Energy shares rose 4.9% to $9.58.
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