THE WOODLANDS, Texas – Newpark Resources, Inc. says it has entered into a definitive agreement with Rheochem PLC to acquire its drilling fluids and engineering services unit. Rheochem PLC is a publicly-traded Australian-based oil and gas company. Rheochem provides drilling fluids and engineering services to the oil and gas exploration and geothermal industries with operations in Australia, New Zealand and India.
Newpark will pay approximately A$23.8 million (US$24.13 million) at closing, subject to typical adjustments for working capital. Additional consideration may be payable based on financial results of the acquired business over a one-year earnout period, up to a maximum total consideration of A$45 million (US$45.63 million). Newpark expects to fund the acquisition price, including any earnout payment, from cash on hand. This acquisition is subject to the approval of the shareholders of Rheochem PLC and normal customary closing conditions and is expected to close in the second quarter of 2011.