Lufkin Industries Inc. signed a deal to acquire privately held Canadian firm Quinn’s Oilfield Supply Ltd. for about $303 million.
Lufkin President and Chief Executive John F. “Jay” Glick said the addition of the manufacturer of reciprocating rod pumps and other equipment expands Lufkin’s portfolio in artificial lift systems, which are used in unconventional shale plays.
Lufkin, which sells and services oilfield pumping units, automation systems and other products, said the deal will extend its sales and service network in the U.S. and Western Canada.
Lufkin also said that Quinn’s 2010 GrenCo Industries acquisition, which manufactures and distributes progressive cavity pumps and related equipment, is likely to see strong growth because it products are suited to heavy oil production.
The deal, set to close before year’s end, is expected to add to Lufkin’s 2012 earnings.
Lufkinin July reported that its second-quarter revenue beat analysts’ consensus estimate, but earnings-per-share fell short. The company said earnings were hurt by production ramp-up inefficiencies at some U.S. operations and rising inflation in Argentina that drove up materials costs and spawned labour strikes that disrupted its customers’ field operations, among other things.
Shares closed Friday at $58.83 and were inactive premarket. Markets were closed Monday for the Labour Day holiday.
