Superior Energy Services/Complete Production Services
On October 10, 2011, Superior Energy Services, Inc. (NYSE: SPN) and Complete Production Services, Inc. (NYSE: CPX) approved a definitive merger agreement combining the two companies into the premier diversified mid-cap oilfield services company.
Under terms of the agreement, Complete stockholders will receive 0.945 common shares of Superior and cash of $7.00 in exchange for each share of Complete common stock held at closing. This represents a premium of 29% to Complete's average price over the last two months. Upon closing, and reflecting the issuance of new Superior shares, Superior and Complete stockholders are expected to own approximately 52% and 48%, respectively, of Superior's outstanding shares.
Superior expects the combination to be accretive to earnings per share and cash flow per share in 2012, excluding transaction and integration costs. Superior further expects the transaction will be balance sheet neutral as measured by key leverage ratios, yet ultimately is expected to result in an overall credit profile enhancement given the significant increase in scale and diversity provided by the combination.
Both Superior and Complete confirmed their prior guidance for 2011; however, Complete indicated that third quarter results will be below its prior guidance. Complete now expects third quarter 2011 EBITDA to be between $155 million and $160 million.
The combined company will retain the name Superior and will be led by David Dunlap, Superior's current President and Chief Executive Officer. The Superior Board of Directors will be expanded to include two independent Complete Board members.
The merger is subject to the approval of both Superior's and Complete's stockholders as well as other customary approvals. The companies anticipate that the transaction will close as soon as the end of this calendar year. Superior and Complete intend to file a joint proxy statement / prospectus with the Securities and Exchange Commission as soon as possible.
Greenhill & Co. is acting as Superior's transaction and financial advisor and rendered a fairness opinion to Superior's Board of Directors. In addition, J.P.Morgan provided transaction advice, acted as financial advisor and provided a bridge financing commitment with respect to the cash portion of the transaction. Jones, Walker, Waechter, Poitevent, Carrere & Denegre L.L.P. is acting as Superior's legal advisor. Credit Suisse Securities (USA) LLC is acting as Complete's financial advisor and rendered a fairness opinion to Complete's Board of Directors. Complete's legal advisor is Latham & Watkins LLP.
Under terms of the agreement, Complete stockholders will receive 0.945 common shares of Superior and cash of $7.00 in exchange for each share of Complete common stock held at closing. This represents a premium of 29% to Complete's average price over the last two months. Upon closing, and reflecting the issuance of new Superior shares, Superior and Complete stockholders are expected to own approximately 52% and 48%, respectively, of Superior's outstanding shares.
Superior expects the combination to be accretive to earnings per share and cash flow per share in 2012, excluding transaction and integration costs. Superior further expects the transaction will be balance sheet neutral as measured by key leverage ratios, yet ultimately is expected to result in an overall credit profile enhancement given the significant increase in scale and diversity provided by the combination.
Both Superior and Complete confirmed their prior guidance for 2011; however, Complete indicated that third quarter results will be below its prior guidance. Complete now expects third quarter 2011 EBITDA to be between $155 million and $160 million.
The combined company will retain the name Superior and will be led by David Dunlap, Superior's current President and Chief Executive Officer. The Superior Board of Directors will be expanded to include two independent Complete Board members.
The merger is subject to the approval of both Superior's and Complete's stockholders as well as other customary approvals. The companies anticipate that the transaction will close as soon as the end of this calendar year. Superior and Complete intend to file a joint proxy statement / prospectus with the Securities and Exchange Commission as soon as possible.
Greenhill & Co. is acting as Superior's transaction and financial advisor and rendered a fairness opinion to Superior's Board of Directors. In addition, J.P.Morgan provided transaction advice, acted as financial advisor and provided a bridge financing commitment with respect to the cash portion of the transaction. Jones, Walker, Waechter, Poitevent, Carrere & Denegre L.L.P. is acting as Superior's legal advisor. Credit Suisse Securities (USA) LLC is acting as Complete's financial advisor and rendered a fairness opinion to Complete's Board of Directors. Complete's legal advisor is Latham & Watkins LLP.
