TAQA Drilling subsidiary to acquire Schlumberger's Middle East drilling rigs business for $415mn
The deal will create a pan-regional drilling entity with 58 onshore and 9 offshore rigs across Saudi Arabia, Kuwait, Oman, Iraq and Pakistan.
Saudi Arabia's Industrialisation and Energy Services Company (TAQA) announced today that its drilling subsidiary, Arabian Drilling Company (ADC), has agreed to acquire Schlumberger's Middle East onshore drilling rigs business in Kuwait, Oman, Iraq and Pakistan for $415mn.
Through this expansion, ADC will operate a fleet of 58 onshore rigs and 9 offshore rigs across the MENA region. The combined firm will have more than 5,900 employees.
TAQA's 2021 strategy is to become a leading regional oilfield services and equipment (OFSE) company and is based on three key pillars: Creating value by strengthening the position and growth of its existing businesses and expanding into higher-tier services and new markets; sustaining value by providing differentiated, best-in-class client services and safety, using the latest technologies; and realising value and greater operational efficiencies by delivering more integrated client services that are safe, reliable and competitive.
Commenting on the transaction, Azzam Shalabi, CEO, TAQA and chairman of the ADC board, said: "This acquisition is fully aligned with Saudi Vision 2030. It unlocks value and drives growth across our entire value chain through a more integrated regional approach, while positioning a leading Saudi company as a global player. The transaction also follows on from ADC's accelerated expansion activity in 2018 when 16 rigs were commissioned to support the growth of Saudi Aramco. This new combination clearly demonstrates that TAQA and ADC are delivering on their transformation and growth strategies, and further strengthens what is already a long-standing and trusted partnership between TAQA and Schlumberger. We look forward to supporting ADC in the next phase of its expansion and have full confidence that this will benefit all stakeholders, most notably our regional clients."
The transaction is expected to close in the second half of 2019, subject to regulatory approvals.
Moelis & Company acted as exclusive financial advisor to TAQA, and Rothschild & Co. acted as exclusive financial advisor to Schlumberger.