Another big oilfield services merger announced

Apergy Corporation, based in The Woodlands, has announced that it will merge with the upstream division (aka Nalco Champion) of Ecolab. The combined company will remain in The Woodlands.

Apergy was spun off from Dover Corporation in May 2018 and is primarily involved in Artificial Lift.  Ecolab, based in Minnesota, had originally announced in February 2019 that it intended to spin off Champion through an initial public offering. Champion primarily manufactures oilfield chemicals.



The company will be the second largest production-focused oilfield services company, behind Baker Hughes. Proforma revenues are $3.5 billion, 80% of which is derived from production.

The combined company will have an enterprise value of $7.4 billion, including just over $1 billion of debt. Apergy shareholders and existing Ecolab shareholders will own 38% and 62% of the combined company, respectively. Apergy is paying $3.9 billion in newly-issued shares and $492 million in cash to Ecolab.

The combined companies are assuming $75 million of cost savings. Including these savings, the transaction represents 9.5 times 2020 estimated EBITDA.

Apergy CEO Soma Somasundaram and Apergy CFO Jay Nutt will be CEO and CFO of the combined company. Deric Bryant, the EVP of Ecolab’s Upstream business will become COO.

The transaction is expected to close in the second quarter of 2020.

The announcement comes one day after Superior Energy agreed to spin off its US completions business and merge it with Forbes Energy.

Apergy – Investor Presentation

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