Key Energy Services Reports Asset Acquisition
Key Energy Services announced the acquisition of nearly all assets of Endeavor Energy Resources' well servicing division in an all-cash deal effective May 19, 2024. This move will bolster Key's operations in the Permian Basin. CEO Marshall Dodson expressed enthusiasm about integrating new assets and personnel, emphasizing that Key’s strengthened balance sheet and liquidity enabled the purchase and debt reduction. Key will maintain its commitment to providing top-tier service and equipment, particularly to Endeavor. The company highlighted improvements in safety and financial performance, attributing these achievements to dedicated employees.
- Acquisition of Endeavor Energy Resources' well servicing assets enhances Key’s footprint in the Permian Basin.
- All-cash transaction indicates strong liquidity position.
- Strengthened balance sheet facilitated the acquisition and enabled debt reduction.
- Commitment to maintaining high safety standards and exceptional service quality.
- Positive operating results and free cash flow over the past years.
- No specific financial details of the acquisition were disclosed.
- Potential integration challenges with new assets and personnel.
- Increased operational risks with growing employee base and activity levels.
HOUSTON, May 19, 2024 (GLOBE NEWSWIRE) -- Key Energy Services, Inc. (“Key” or the “Company”) today announced the purchase of substantially all the assets of the well servicing division of Endeavor Energy Resources, L.P. (“Endeavor”) in an all-cash transaction effective May 19, 2024. Key will continue support Endeavor’s well servicing needs in the Permian Basin with these assets.
Key’s President and Chief Executive Officer, Marshall Dodson, stated, “We are excited about this transaction and the great people and assets we have added to our team. We look forward to continuing our relationship with Endeavor, partnering with them to provide the same safe and exceptional service they are accustomed to.”
Dodson continued, “I am very proud of the progress our team at Key has made over the past several years, strengthening our balance sheet to a position where we can add to our already strong footprint in the Permian Basin. Our balance sheet and liquidity have benefited over the past few years from our positive operating results and free cash flow, enabling both this purchase and reductions in our debt outstanding.”
“We are extremely focused on providing Endeavor, and all our customers, with best-in-class service and equipment and doing so with industry leading safely. I’m pleased to say that even with the challenges of increasing activity and a growing employee base, Key is working safer than at any time in its 45-year history.”
Dodson concluded, “I would like to thank the Key employees for all of their dedication and efforts not only for the constant drive to make every job we do at Key incident free, but also for the improvements in our financial position over the past several years.”
About Key Energy Services
Key Energy Services provides a wide array of leading-edge energy production solutions and services. Through our highly trained and experienced crews, technical expertise, state-of-the-art data analytics, and fit for purpose equipment, Key enable America’s E&P companies, from small independents to majors, to get the most out of the life of their wells.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not historical in nature or that relate to future events and conditions are, or may be deemed to be, forward-looking statements, including statements relating to Key's operational and financial strategies, including leverage reduction strategies, Key’s ability to successfully effect those strategies and the expected benefits therefrom. These forward-looking statements are based on Key’s current expectations, estimates and projections and its management’s beliefs and assumptions concerning future events and financial trends affecting its financial condition and results of operations. In some cases, you can identify these statements by terminology such as “may,” “will,” “should,” “predicts,” “expects,” “believes,” “anticipates,” “projects,” “potential” or “continue” or the negative of such terms and other comparable terminology. These statements are only predictions or estimates and are subject to substantial risks and uncertainties and are not guarantees of performance. Future actions, events and conditions and future results of operations may differ materially from those expressed in these statements and the assumptions on which they are based could prove incorrect. Key undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date of this press release except as required by law. All of Key’s written and oral forward-looking statements are expressly qualified by these cautionary statements and any other cautionary statements that may accompany such forward-looking statements.
Important factors that may affect Key’s expectations, estimates or projections include, but are not limited to, the following: public health crises, including any impact on economic and other conditions globally and any related actions taken by businesses and governments, among others; adverse conditions in the services and oil and natural gas industries, especially oil and natural gas prices and reduced activity and capital expenditures by oil and natural gas companies; a failure of customer activity to reach or remain at expected levels; Key’s ability to satisfy its cash and liquidity needs, including its ability to generate sufficient liquidity or cash flow from operations or to obtain adequate financing to fund its operations or otherwise meet its obligations as they come due; Key’s ability to implement price increases or maintain pricing on its core services; inflationary pressures; supply chain challenges; risks that Key may not be able to reduce, and could even experience increases in, the costs of labor, fuel, equipment and supplies employed in its businesses; industry capacity; actions by OPEC and non-OPEC oil producing countries; the market impact of global conflict or war, such as those in Ukraine and Gaza; asset impairments or other charges; demand for Key’s services; the highly competitive nature of Key’s industry; operating risks, which are primarily self-insured, and the possibility that its insurance may not be adequate to cover all of its losses or liabilities; significant costs and potential liabilities resulting from compliance with applicable laws, including those resulting from environmental, health and safety laws and regulations, specifically those relating to hydraulic fracturing, as well as climate change legislation or initiatives; changes in government; Key’s historically high employee turnover rate and its ability to replace or add workers; Key’s ability to implement technological developments and enhancements; severe weather impacts on Key’s business, including hurricane activity; Key’s ability to successfully identify, make and integrate acquisitions and its ability to finance future growth of its operations or future acquisitions; Key’s ability to achieve the benefits expected from business combinations, disposition or acquisition transactions; the loss of one or more of Key’s larger customers; the amount of Key’s debt, the limitations imposed by the covenants in the agreements governing its debt, and its ability to comply with covenants under its debt agreements; Key’s ability to maintain sufficient liquidity and access to capital; an increase in Key’s debt service obligations due to variable rate indebtedness; Key’s inability to achieve its financial, capital expenditure and operational projections; Key’s ability to respond to changing or declining market conditions, including Key’s ability to restart operations or to reduce the costs of labor, fuel, equipment and supplies employed and used in its businesses; and the adverse impact of litigation and disputes.
Cautionary Statement Regarding Trading in Key Common Stock
Key’s common stock is not listed on a national securities exchange and may trade on the Over-the-Counter Market from time to time. Key provides no assurance with respect to whether any market for the shares will be maintained or any price at which the shares may trade. Key is not obligated to publish current information for purpose of OTC Market requirements, and issuance of this press release does not create an obligation for Key to publish results for future periods. Investors are cautioned that trading unregistered securities quoted on the OTC Pink Market is more limited, subject to greater liquidity risk and additional restrictions. Investing in unregistered securities is not suitable for all investors. Investors should consult their own attorneys, accountants and/or other advisors as to the legal, tax, regulatory, accounting, economic and related aspects of investment in unregistered securities and its suitability for them.
FAQ
What assets did Key Energy Services acquire from Endeavor Energy Resources?
When did Key Energy Services finalize the acquisition of Endeavor's assets?
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