A subsidiary of Weatherford International plc has signed an agreement with ADES International Holding Ltd. for the sale of Weatherfords land drilling rig operations in Algeria, Kuwait and Saudi Arabia, as well as two idle land rigs in Iraq
The transaction, for an aggregate cash purchase price of US$287.5mn, includes 31 land drilling rigs and related drilling contracts, as well as approximately 2,300 employees and contract personnel.
Upon closing, Weatherford will use the proceeds to reduce its debt.
"We are pleased to have signed an agreement with ADES, a company that is known for providing high quality and efficient services with an extensive track record of serving leading regional and global oil and gas customers," said Mark A. McCollum, president and CEO of Weatherford. "ADES is acquiring an efficient fleet of land drilling rigs and a dedicated workforce with more than 60 years of experience in delivering drilling efficiency, operational excellence, and first-class safety. It was very important to us to find a buyer who will continue to provide the same level of service quality, safety and dedication to customers in this region."
Commenting on the transaction, Dr. Mohamed Farouk, CEO of ADES International Holding, said, "This landmark transaction significantly expands ADES' total fleet and more than doubles its operational fleet, in line with our strategy of executing smart acquisitions, alongside building our backlog and participation in tenders. Similar to our prior acquisitions, ADES is committed to the swift value extraction of its acquired assets utilising the company's focused business model."
This transaction is the second in a series of previously announced planned divestitures, designed to maximise Weatherford shareholder value by refocusing the company's portfolio on the businesses most closely aligned with its long-term strategy and to reduce its debt. Weatherford plans to divest its remaining land drilling rigs through a series of smaller sales in the coming quarters.
