Helmerich & Payne , Inc. (NYSE:HP (NYSE:HPQ)), an oil and gas drilling company, announced on Monday an amendment to its previously arranged acquisition of KCA Deutag. The amendment stipulates that the transaction will not be completed until at least January 15, 2025.
The Tulsa-based company, which operates under the SIC code for Drilling Oil & Gas Wells, had entered into a Sale and Purchase Agreement on July 25, 2024, for the acquisition of KCA Deutag, a global drilling and engineering contractor. The agreement was made with Majority Sellers, a Management Seller, Ocorian Limited as the Trustee, and HP Global Holdings Limited, a wholly owned subsidiary of Helmerich & Payne, as the Purchaser.
According to the 8-K filing with the Securities and Exchange Commission, Helmerich & Payne and the other parties involved signed a Deed of Amendment to the Purchase Agreement on December 20, 2024. This amendment changes the original terms, extending the closing date of the transaction to no earlier than January 15, 2025. The completion of the acquisition is subject to regulatory approvals and the satisfaction of other customary closing conditions.
Helmerich & Payne expects the acquisition to be finalized in January 2025, which will mark a significant expansion for the company. The information disclosed in the 8-K filing is furnished and is not considered "filed" for purposes of Section 18 of the Exchange Act, nor is it to be incorporated by reference into any SEC filings, unless specified.
This strategic move comes as the oil and gas industry continues to consolidate operations and expand their portfolios to enhance their market presence. Helmerich & Payne’s acquisition of KCA Deutag will potentially create a more comprehensive service offering in the drilling sector.
In other recent news, Helmerich & Payne reported quarterly revenues of $694 million along with a net income of $0.76 per diluted share. The company also announced a quarterly cash dividend of $0.25 per share, set for distribution to eligible stockholders.
Despite a 5% decline in the U.S. rig count, the company managed to increase its North America Solutions rig count to 151. RBC Capital Markets adjusted its outlook on Helmerich & Payne, revising the price target downward to $41 from $44 while maintaining a Sector Perform rating. The firm cited the company’s strategic focus and upcoming acquisition of KCA Deutag as reasons for the revision.
The acquisition of KCA Deutag is expected to enhance Helmerich & Payne’s global presence and operational scale. These are the recent developments in the company’s financial performance and strategic initiatives. The management expects a flat rig count in the first half of 2025, with potential declines in the second half. The company aims to maintain a strong dividend and improve cash flow while integrating KCA Deutag."
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