Sweden’s Sandvik AB has announced it has reached an agreement to acquire Varel International Energy Services Inc., headquartered in Carrollton, Texas, USA, a global supplier of drilling solutions focusing on drill bits, downhole products for well construction and well completion. The acquisition price is reported at approximately $740 million USD.
Varel’s key customer segment is in the oil and gas sector, with some exposure to the mining and construction industries. The company has manufacturing sites located in Houston (USA), Matamoros (Mexico), Aberdeen (Scotland), Tarbes (France), and Kurgan (Russia).
Varel, currently employing around 1,300, will form a new product area within the business area Sandvik Venture.
“The acquisition forms a platform to enable Sandvik to enter into drilling solutions in the oil and gas sector. The combination of Varel’s solid market position and strong customer offering, and Sandvik’s broader drilling solutions capabilities as well as the extensive knowledge in highly relevant materials and cutting technology will support Varel’s continued growth. I am very impressed by the Varel team and I am excited about our joint opportunities going forward,” stated Tomas Nordahl, President of Sandvik Venture.
“The acquisition continues to position Sandvik in attractive growth segments where we will deliver solutions that increase customers’ productivity. This is in line with Sandviks growth ambition and a way to leverage our technical know how and Varel’s market position,” added Olof Faxander, Sandvik’s President and CEO.