IRVINE, Calif., Feb. 6 /PRNewswire/ -- NuTek, Inc. (Nasdaq-BB: NUTK) announced today that it has entered into a contract for the purchase of Non- Magnetic Rental Tools, Inc. D/b/a Non Mag, of Broussard, Louisiana. Non Mag is an oil field service company specializing in the rental of downhole directional drilling equipment.
Non Mag was founded in 1975 and has quickly become one of the leading suppliers of non magnetic equipment in the Gulf Coast area. Since 1994, Non Mag has expanded operations to Houston and Midland, Tx. New services have been added to include machine shop services, drill hole openers, steel stabilizers, and the sales of ancillary equipment supplementing the directional drilling industry.
Non Mag is the exclusive supplier of Mag Coat, an anti galling compound for non magnetic equipment. Non Mag is quickly becoming known as the "Directional Drilling Supply Center" of the Gulf Coast Area. It is on the preferred vendor list for the major oil companies operating in the U.S.
John Mitchell Cobb, CEO of Non Mag, and Marcus Tye Cobb, President of Non Mag stated, "The number of drilling rigs operating in Texas has expanded to over 250. This growth has created a vast unmet demand for downhole drilling equipment. The acquisition by NuTek is extremely exciting. NuTek will open new capital markets that will allow us to accelerate our revenue growth and profitability in meeting this demand."
Non Mag's revenues for 1996 are approximately $3.6 million, an increase of 40% over 1995. Revenues for 1997 are expected to be $5.4 million.
"The acquisition of Non Mag by NuTek adds significant growth to NuTek through diversification into the oil field service business. An enormous amount of synergy exists between the two companies. This synergy will allow us to take advantage of increased drilling activity and provide an "in-house" arm with which to help expand production on our existing acreage. They can also provide a manufacturing and marketing arm for additional oil production technology which we plan to present to the market in the coming months," said Rodger Garrity, President.
The Non Mag acquisition should represent, on a fully diluted basis, approximately $0.15 new earnings per share for 1997.
As part of the transaction, Non Mag will acquire a seat on the board of directors of NuTek, Inc.
NuTek, Inc., an emerging growth company in the oil industry, acquired New Lift, Inc., an oil industry technology and production company, in October 1994. It next acquired Vac-U-Lift Production Company, Inc., an oil production company operating in the Prolific Austin Chalk and Big Foot fields in South Texas, in July 1996. Vac-U-Lift expects to drill its first well in Big Foot in the next two weeks. NuTek, Inc. operates the proprietary "Bailer Pump(R)," which generates a high level of profitability from wells no longer utilized by other companies.
SOURCE NuTek, Inc.
CO: NuTek, Inc.; Non-Magnetic Rental Tools, Inc.
ST: California
IN: OIL MNG
SU: TNM
02/06/97 12:56 EST prnewswire.com
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