CARROLLTON, Texas--(BUSINESS WIRE)--Varel International Energy Services (VIES) and its subsidiaries, Varel International and Downhole Products Ltd, have completed their previously announced refinancing, totaling $325MM. The deal includes a $20MM revolving credit facility, a $220MM term loan and an $85MM mezzanine tranche. Credit Suisse took the lead in facilitating the deal on behalf of VIES.
“The consummation of this deal is an acknowledgement of the performance that has been achieved by both our Varel International and Downhole Products subsidiaries.”
The funding allows VIES to refinance the capital structure of the firm, bolster liquidity, fund general corporate purposes and cover associated fees and expenses.
“We are quite pleased to have been able to complete this refinancing in less than two months,” said VIES President and CEO Jim Nixon. “The consummation of this deal is an acknowledgement of the performance that has been achieved by both our Varel International and Downhole Products subsidiaries.”
Nixon continued, “This new financing structure will allow VIES the flexibility to more effectively pursue our goals of geographic and product line expansion and drive our continued market share growth.”
John Capasso, VIES Vice President and CFO, added, “The refinancing provides VIES and its subsidiaries with long term financing at a lower cost while improving the Company’s liquidity position.”
About Varel International Energy Services
Varel International Energy Services is comprised of two primary operating units, Varel International and Downhole Products.
Founded in 1947, Varel International is the world's largest independent supplier of earth boring drill bits. Headquartered in Carrollton, Texas, Varel services oil & gas, mining, and industrial markets with its comprehensive suite of roller cone and fixed cutter drill bits. The company employs more than 1,000 people and has manufacturing facilities in Houston, Texas; Matamoros, Mexico; Kurgan, Russia and Tarbes, France, as well as sales offices throughout the world. For more information, visit www.varelintl.com.
Downhole Products specializes in the design and manufacture of engineered tubular enhancement products for the global upstream oil and gas industries. Since 1994, Downhole Products has been developing and providing downhole solutions aimed at reducing torque and drag and improving casing running and cementing integrity. Downhole Products operates from offices located in Aberdeen, Houston, Kuala Lumpur and Bahrain. For further information visit: www.downhole.org
Statements in this news release that are not historical facts are forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or implied in any forward-looking statements. In particular, the sale transaction described is subject to certain risks and uncertainties, including the ability of the buyer to obtain financing, the ability to obtain all required regulatory approvals and the anticipated tax treatment of the sale and related transactions, as well as risks relating to any unforeseen liabilities, losses, declines in economic performance or future prospects. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.