Amid Low Crude Oil Prices, Frank's Pays $75M for Energy Services Business
Frank's International NV (NYSE: FI) is buying Timco Services Inc. for $75 million, adding to energy-services M&A.
Timco, headquartered in Lafayette, Louisiana, provides tubular running services and rental equipment in the southern U.S. and offshore in the Gulf of Mexico.
Amsterdam-based Frank's is an oil services company that provides pipe services to onshore and offshore oil production companies.
The purchase price works out to $75 million in cash, and includes a potential earn out of up to $20 million and a tax reimbursement payment of $8 million, according to a filing with the U.S. Securities and Exchange Commission.
Simmons & Co. was Frank's financial adviser, while Vinson & Elkins LLP provided legal advice. Founders Investment Banking was Timco's financial services, and Butler Snow LLP was legal counsel.
In February, dealmakers predicted that for the short-term, we would see fewer energy deals. As low crude oil prices cause many energy companies to struggle, investors are expected to move into the sector to acquire businesses at a discount. For more, see Investors Flow Into Oil and Gas.