Magseis acquires Fairfield Geotechnologies' seismic technologies business
HOUSTON -- Fairfield Geotechnologies today announced that it has entered into a definitive agreement with Magseis ASA (Magseis), whereby Magseis will acquire the Seismic Technologies business from Fairfield comprising data acquisition, nodal and system sale & rental activities, including all shares in Fairfield's wholly owned UK subsidiary WGP Group. The name of the new business will be Magseis Fairfield. Fairfield Geotechnologies will remain privately held by the Sugahara family through Fairfield-Maxwell and focus its efforts on data licensing and data processing, as well as imaging, data analytics and data interpretation.
The parties have agreed that the purchase price payable by Magseis shall be based on an enterprise value for the Business of approximately $233 million, which comprises a combination of cash and Magseis shares. In addition, Fairfield-Maxwell will receive five year warrants and certain rights under an earn-out payment mechanism related to a project in Al Shaheen field, in Qatar. The final purchase price will be subject to closing working capital adjustments.
The Transaction combines two highly complementary businesses to create a leading provider of marine seismic solutions, including Ocean Bottom Seismic (OBS):
- Unmatched global presence through complementary geographical footprints
- Combined client base comprising the world’s largest E&P companies
- Most efficient technologies for all OBS segments and offerings
- Demonstrated track-record and profitability
- Solid combined backlog of more than $350 million
- Positioned for accelerated growth in the expanding marine seismic industry Fairfield Seismic Technologies is a leading provider of marine ocean bottom nodal (OBN) seismic systems.
The business has performed 45 OBN surveys globally since 2005 and owns an extensive portfolio of intellectual property for both OBS, land and permanent reservoir monitoring solutions. Headquartered in Houston, the Business has approximately 230 full-time employees and 250 contracted personnel.
Byron Sugahara, Chairman of Fairfield-Maxwell Ltd, the owner of Fairfield, says, “Through Fairfield-Maxwell, my family has owned and invested in Fairfield Geotechnologies for more than 40 years. We are excited to become Magseis Fairfield’s largest shareholder given our positive outlook on the seismic services industry and confidence in the combined management team. We are also pleased that the transaction will provide Fairfield-Maxwell additional capital for potential reinvestment in Fairfield Geotechnologies’ remaining data licensing and data processing business.”
“This transformational transaction enables Magseis to take pole position in the development of the marine seismic industry with critical mass, leading technology, modern crews and financial capabilities to capitalize on exciting growth opportunities,” says Jan Pihl Grimnes, Chairman of the Board of Directors of Magseis.
The Chairman, CEO and President of Fairfield, Charles W. (Chuck) Davison, has been proposed as the new Chairman of the Board of Directors of Magseis upon completion of the Transaction. Anthony Dowd, President and CEO of Fairfield-Maxwell Ltd, has been proposed as a member of Magseis' nomination committee.
“We are truly excited and look forward to combining with Magseis, creating a leader in the marine seismic industry on a global basis. We believe the multiple value creation opportunities afforded by the Transaction are extremely compelling and in the best long-term interest of all stakeholders, including our customers and employees,” says Chuck Davison.
“Magseis and Fairfield Seismic Technologies combined will have the industry’s largest nodal inventory and be positioned for global operations with substantial scale advantages. The combined entity will have an excellent technology platform providing optimal ability to meet all client requirements regardless of geography, water depth and acquisition methodology,” says Per Christian (PC) Grytnes, CEO of Magseis.
Following completion of the Transaction, the combined organization will comprise approximately 430 full-time employees and be structured in three business areas: (i) Eastern Hemisphere Operations (Headquarters in Oslo, Norway), (ii) Western Hemisphere Operations (Headquarters in Houston, USA) and (iii) Technology.
The Transaction does not include the data licensing or data processing business of Fairfield, which will be retained by Fairfield. The Business will be carved out of Fairfield's organization and transferred into a newly incorporated company owned by Fairfield before completion of the Transaction.
Fairfield Geotechnologies will have access to Magseis Fairfield’s equipment and services through a five-year preferred supplier agreement.
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