MIDLAND, Texas, Dec. 16, 2010 /PRNewswire-FirstCall/ -- Basic Energy Services, Inc. (NYSE: BAS) ("Basic") announced today that it has acquired all of the outstanding stock of Platinum Pressure Services, Inc. ("Platinum Pressure Services") for total cash consideration of $35.0 million, net of working capital acquired.
Platinum Pressure Services owns 13 snubbing units, which are located primarily in the Marcellus shale, and has additional operations in the Ark-La-Tex region and Barnett shale. Admiral Well Service, Inc. ("Admiral)", a wholly owned subsidiary of Platinum Pressure Services, operates six well servicing rigs, all in the Marcellus shale. Basic expects that this acquisition will contribute revenue and EBITDA (defined as earnings before interest, taxes, depreciation and amortization) of approximately $33.0 million and $10.0 million, respectively, in 2011, and will be accretive to earnings in 2011. With this acquisition, Basic's current snubbing fleet increases to 25 units and its well servicing rig fleet increases to 409 rigs.
Ken Huseman, Basic's President and Chief Executive Officer, stated, "The acquisition of the Platinum Pressure Services and Admiral operations provides an excellent platform on which to expand in the growing Marcellus Shale market with well-trained personnel and first-rate equipment. We are particularly excited to expand our existing snubbing capabilities with an organization known for pioneering this service in recent years in several of the unconventional plays. The increasing number and length of extended laterals is expected to drive demand for snubbing services, not only in the initial completion, but in the subsequent maintenance and workover operations performed on those wells. These services are a natural extension of the well site services we currently provide."
Basic Energy Services provides well site services essential to maintaining production from the oil and gas wells within its operating area. The company employs more than 4,300 employees in more than 100 service points throughout the major oil and gas producing regions in Texas, Louisiana, Oklahoma, New Mexico, Arkansas, Kansas, and the Rocky Mountain and Appalachian regions.
Additional information on Basic Energy Services is available on the Company's website at http://www.basicenergyservices.com.
Safe Harbor Statement
This release includes forward-looking statements and projections, made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Basic has made every reasonable effort to ensure that the information and assumptions on which these statements and projections are based are current, reasonable, and complete. However, a variety of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this release, including (i) changes in demand for our services and any related material impact on our pricing and utilizations rates, (ii) Basic's ability to execute, manage and integrate acquisitions successfully and (iii) changes in our expenses, including labor or fuel costs and financing costs. Additional important risk factors that could cause actual results to differ materially from expectations are disclosed in Item 1A of Basic's Form 10-K for the year ended December 31, 2009 and subsequent Form 10-Qs filed with the SEC. While Basic makes these statements and projections in good faith, neither Basic nor its management can guarantee that anticipated future results will be achieved. Basic assumes no obligation to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by Basic, whether as a result of new information, future events, or otherwise.
Alan Krenek, Chief Financial Officer
Basic Energy Services, Inc.
Jack Lascar/Sheila Stuewe
DRG&L / 713-529-6600
SOURCE Basic Energy Services, Inc.