HAMILTON: Archer Limited has signed an SPA to acquire DeepWell based on an enterprise value of NOK 177 million on a debt and cash free basis.
The Transaction is accretive both to Archer’s NIBD / EBITDA ratio and EV / EBITDA ratio. Archer will use existing cash and liquidity reserves to finance the Transaction.
DeepWell is a leading Norwegian well intervention company focused on high-tech based wireline services. The company provides wireline and downhole services to oil companies on the Norwegian Continental Shelf (NCS). Headquartered at Karmøy Norway, DeepWell employed approximately 200 people and had a revenue of NOK 360 million in 2020. DeepWell commands one of the most modern wireline unit fleets on the NCS and holds a strategic long-term contract in the light well intervention market.
Archer’s VP Wireline, Lage Nordby, comment: “We are pleased to welcome DeepWell’s team of employees to Archer. By strengthening our wireline equipment fleet and organization, increasing our low emission solutions, and continuing our track record for service quality, Archer is well positioned on the Norwegian Continental Shelf. The acquisition of DeepWell gives us access to equipment and employees needed in order to fulfill our obligations under our recently awarded wireline contracts with Equinor and ConocoPhillips.”
Jan Erik Rugland, COO of Moreld AS and CoB of Deepwell: “We are pleased to have reached an agreement with Archer securing continued operations on existing contracts and the continued development of DeepWell’s state of the art wireline technology. I want to thank all the employees, both on – and offshore, for their dedication and perfection. This transaction is in line with our strategy to divest capital intensive businesses in order to focus our energy on transition and growth plans.”
Archer’s management will provide further information about the rationale for the Transaction in the scheduled quarterly release call May 12, 2021.
The closing of the Transaction is expected to be finalized during second quarter 2021 and is subject to customary closing conditions and regulatory approvals.