CALGARY,
AB, July 14, 2022 /CNW/ - Cathedral Energy
Services Ltd. (TSX: CET) ("Cathedral" or the
"Company") is pleased to announce that the Company has
closed its previously announced acquisition (the
"Acquisition") of Altitude Energy Partners, LLC
("Altitude") for a total purchase price of approximately USD
$100,000,000 (the "Purchase
Price"). The Purchase Price was satisfied through the issuance
of 67,031,032 common shares in the capital of Cathedral ("Common
Shares") and a cash amount of USD $62,675,000.
Following the completion of the Acquisition, the Company plans
to continue to use the Altitude name and brand in the US.
Further, the Altitude management team and its people will lead and
operate Cathedral's existing US directional drilling business. Mr.
Lee Harns, the current President and
CEO of Altitude, will remain as President of the business unit.
Joining Mr. Harns will be Tyler
Clark, the current COO, and Alex
Bougaieff, the current CFO, along with several other key
long-standing employees and the entire Altitude operational team.
In addition, Mr. J.R. Boyles, a director and founder of Altitude,
will be appointed to Cathedral's board of directors. For further
details about the Acquisition, please see the press release of the
Company dated July 4, 2022.
Key Corporate Takeaways of the
Last 12 Months
- With the completion of six acquisitions in 12 months,
Cathedral has established itself as one of the top directional
drilling companies in North
America by market share
- After the Q2/22 Compass acquisition, Cathedral now has a
more substantial presence in the Montney, and Deep Basin, which are key focus
areas for Canada's LNG
market
- The acquisition of Altitude positions Cathedral as one of
the leading independent directional drilling companies in the US,
with key exposure in the Permian, Haynesville, Bakken, DJ and
Powder River basins
- Cathedral's US platform will enable a wider distribution
of the Company's leading MWD technology
- With the rising prevalence of Rotary Steerable ("RSS")
technology in the North American land drilling market, Cathedral
now has distinct RSS offerings in both countries
- The acquisition of Lexa Drilling Technologies further
enhances and strengthens the Company's technology offering going
forward
- Larger size and scale significantly improve Cathedral's
capacity to generate higher levels of free cash flow and positive
net earnings
- New and expanded management depth, capacity, and
experience with the addition of proven, high-performing individuals
focused on delivering value to the Company and its
customers
ABOUT CATHEDRAL
Cathedral Energy Services Ltd., based in Calgary, Alberta is incorporated under the
Business Corporations Act (Alberta) and operates in the U.S. under
Cathedral Energy Services Inc. Cathedral is publicly-traded on the
Toronto Stock Exchange under the symbol "CET". Cathedral is a
trusted partner to North American energy companies requiring high
performance directional drilling services. We work in partnership
with our customers to tailor our equipment and expertise to meet
their specific geographical and technical needs. Our experience,
technologies and responsive personnel enable our customers to
achieve higher efficiencies and lower project costs. For more
information, visit www.cathedralenergyservices.com
Certain U.S. Legal
Matters
This news release does not constitute an offer to sell or a
solicitation of an offer to sell any of securities in the United States. The securities have not
been and will not be registered under the United States Securities
Act of 1933, as amended (the "U.S. Securities Act") or any
state securities laws and may not be offered or sold within
the United States or to, for the
account or benefit of, U.S. Persons (as such term is defined in
Regulation S under the U.S. Securities Act) unless registered under
the U.S. Securities Act and applicable state securities laws or an
exemption from such registration is available. This news release
shall not constitute an offer to sell or the solicitation of an
offer to buy, nor shall there be any sale of these securities, in
any jurisdiction in which such offer, solicitation or sale would be
unlawful.
FORWARD-LOOKING
INFORMATION
This press release contains statements and information that may
constitute "forward-looking information" within the meaning of
applicable securities legislation, including statements identified
by the use of words such as "will", "expects", "positions",
"believe", "potential" and similar words, including negatives
thereof, or other similar expressions concerning matters that are
not historical facts. Forward-looking information in this news
release includes, but is not limited to, statements regarding:
anticipated successful integration of the Altitude assets and
personnel; anticipated increase in U.S. and Canada market share from completed
acquisitions; free cash flow (see Non-GAAP measures); and
Cathedral's business plans and strategies for growth. Such
forward-looking information is based on various assumptions that
may prove to be incorrect, including, but not limited to,
assumptions with respect to: the benefits from the Acquisition; the
integration of the Altitude business into Cathedral's business;
anticipated prevalence of new technologies in North American land
drilling markets; conditions in the oil and gas markets and debt
and equity markets generally; the ability of the Company to
successfully implement its strategic plans and initiatives and
whether such strategic plans and initiatives will yield the
expected benefits. Although the Company believes that such
assumptions are reasonable, the Company can give no assurance that
such forward-looking statements will prove to be correct or that
any of the events anticipated by such forward-looking statements
will occur, or if any of them do so, what benefits the Company will
derive there from. Actual results could differ materially due to a
number of factors and risks including, but not limited to: the risk
that Cathedral will not be able to integrate the Altitude business
as anticipated or at all; the risk that the Altitude business will
not yield operational or financial benefits as anticipated or at
all; the risk that demand for Cathedral's services will not be as
anticipated; conditions in the oil and gas and financial markets in
Canada and the United States; the ability of management
to execute and fund its business strategy; and the impact of
general economic conditions in Canada and the
United States. Additional information regarding risks and
uncertainties of the Company's business are contained under the
heading "Risk Factors" in the Company's annual information form for
the financial year ended December 31,
2021 and the Company's other public filings which are
available under the Company's profile on SEDAR at www.sedar.com.
The forward-looking information included in this news release is
made as of the date of this news release and the Company does not
undertake an obligation to publicly update such forward-looking
information to reflect new information, future events or otherwise,
except as required by applicable law.
This press release also contains financial outlook information
("FOFI") about prospective results of operations, net earnings, and
free cash flow (see Non-GAAP measures), which are subject to the
same assumptions, risk factors, limitations, and qualifications as
set forth in the above paragraphs. FOFI contained in this press
release was made as of the date of this press release to provide
information about management's current expectations and plans
relating to the future. Readers are cautioned that such
information may not appropriate for any other purpose.
Cathedral disclaims any intention or obligation to update or revise
any FOFI contained in this press release, whether as a result of
new information, future events or otherwise, except as required by
applicable law.
NON-GAAP MEASURES
Cathedral uses certain performance measures in this document
that are not defined under International Financial Reporting
Standards (IFRS). Management believes that these measures provide
supplemental financial information that is useful in the evaluation
of Cathedral's operations and are commonly used by other oilfield
companies. Investors should be cautioned, however, that these
measures should not be construed as alternatives to measures
determined in accordance with IFRS as an indicator of Cathedral's
performance. Cathedral's method of calculating these measures may
differ from that of other organizations, and accordingly, may not
be comparable.
"Free cash flow" is a non-GAAP measure calculated as net cash
provided by operating activities less purchases of property and
equipment and intangible assets. Free cash flow is considered
an indicator of the Corporation's ability to generate cash flow
from operations.
SOURCE Cathedral Energy Services Ltd.