American Securities and certain members of management will retain a minority equity interest in the Company going forward. “Drill bits are a mission-critical downhole consumable product, which are poised to benefit from drilling activity, particularly in the most economic oil and gas plays in North America. Financial terms were not disclosed. The transaction is expected to close prior to year-end 2018. Ulterra is well-positioned to serve producers in these plays given its portfolio of premium PDC drill bits that deliver best-in-class performance and reliability. We look forward to partnering with American Securities and the Ulterra team as the Company enters this next phase of growth. We believe that high-quality equipment manufacturers such as Ulterra will continue to represent attractive investment opportunities, including potential add-on acquisitions for Ulterra, or new standalone opportunities in oil field services and equipment,” said Eric Liaw, Senior Managing Director of Blackstone Energy Partners.
The Company is one of the fastest growing PDC drill bit manufacturers, having more than doubled total revenue since 2016. “During our partnership, John and the talented Ulterra management team have established Ulterra as a market leader through their best-in-class products and focus on customer service,” said Kevin Penn, a Managing Director of American Securities. Ulterra currently has a leading position in many of the most active U.S. onshore oil and gas basins, including the Permian and Eagle Ford, and has a growing presence internationally. “We continue to believe in Ulterra and are excited to remain equity holders in the Company alongside the management team and Blackstone to pursue Ulterra’s next phase of growth,” added Michael Sand, a Managing Director of American Securities.
Ulterra is a leading manufacturer of PDC drill bits to the oil and gas sector. The Company has nearly 250,000 square feet of engineering, manufacturing and service space in Fort Worth, Texas, Leduc, Alberta in Canada and global locations in Oman, Colombia, Argentina, Kurdistan, and is soon to open in Saudi Arabia. With locations all throughout the United States, Canada, and international, Ulterra’s field service locations are conveniently located near the drilling activity to provide direct support for your drilling operations. Kirkland & Ellis served as legal counsel to Blackstone. Barclays served as financial advisor to Blackstone. Simmons & Company International, Energy Specialists of Piper Jaffray and Wells Fargo Securities, LLC acted as financial advisors to American Securities and Ulterra. Weil Gotshal & Manges LLP acted as legal counsel to American Securities and Ulterra. The Company is led by a best-in-class management team who will continue in their current roles going forward, including CEO, John Clunan, and CFO, Maria Mejia, who are joined by a dedicated workforce of more than 600 employees worldwide. The new team will enable the next phase of aggressive growth for our people, our culture, and our partners,” said John Clunan.