Lime Rock Backstops Allis-Chalmers
The oilfield services company’s rights offering will sell 35.7 million common shares of the company’s common stock.
May 21, 2009
Allis-Chalmers Energy Inc., a Houston, Texas-based oilfield services company, said it would sell about 35.7 million shares of the company’s common stock in order to pay down the company’s bank credit facility and senior debt.
The oilfield services company said it would pay its shareholders $2.50 per common share, or 32 percent less than Allis-Chalmers’ closing price of $3.65 on Wednesday. The offer will be backstopped by Lime Rock Partners L.P., a private equity firm that invests primarily in oil and natural gas businesses.
Lime Rock Partners, also based in Houston, Texas, would buy any remaining Allis-Chalmers shares that the company’s shareholders do not acquire. Allis-Chalmers stock price dropped to $3.00 per share following the company’s announcement Thursday.
Earlier this month, Allis-Chalmers saw a net loss of $2.6 million for the first quarter of 2009. In April, Allis-Chalmers amended its $90 million revolving-credit agreement with its lenders, easing the company’s leverage covenants.
In February, the oilfield services company entered into a 10-year joint venture agreement with Rawabi Holding Company Ltd., a Saudi Arabian oilfield company.
For more information on related topics, visit the following:
