Saudi Arabia’s Industrialization and Energy Services Company (TAQA) announced on Sunday that its drilling subsidiary, Arabian Drilling Company (ADC), will acquire Schlumberger’s Middle East onshore drilling rigs business in Kuwait, Oman, Iraq and Pakistan for $415 million. The transaction is expected to transform ADC into a regional drilling leader with one of the largest rig fleets, client portfolios and geographic footprints in the Middle East.
Azzam Shalabi, CEO of 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.”
In a statement, TAQA said the announcement represents a major step forward in its ongoing group-wide transformation and growth strategy. TAQA’s 2021 strategy is to become a leading regional oilfield services and equipment (OFSE) company and is based on three key pillars: First, creating value by strengthening the position and growth of its existing businesses and expanding into higher-tier services and new markets; second, sustaining value by providing differentiated, best-in-class client services and safety, using the latest technologies; and, third, realizing value and greater operational efficiencies by delivering more integrated client services.
Shalabi added: “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 adviser to TAQA, and Rothschild & Co. acted as exclusive financial adviser to Schlumberger.
