Two Calgary-based oilpatch companies with operations in Central Alberta plan to join forces.
Pure Energy Services Ltd. (TSX: PSV) and Canadian Sub-Surface Energy Services Corp. (TSX: CSE) have agreed to combine businesses through a share exchange transaction. Canadian Sub-Surface shareholders will receive approximately 0.3 common shares of Pure Energy for each Canadian Sub-Surface common share they own, with shares in Pure Energy continuing to trade on the Toronto Stock Exchange.
The transaction is conditional upon regulatory and related approvals, with at least two-thirds of Canadian Sub-Surface shareholders required to vote in favour of the arrangement at a meeting to be held in late June.
Kevin Delaney and Brad Gabel, the presidents and CEOs of Pure Energy and Canadian Sub-Surface respectively, said the deal will strengthen both operations.
“The combined company will be the largest independent provider of wireline and testing services in Canada, and the transaction will also facilitate our continued growth in the Rocky Mountain and other selected regions of the United States,” said Delaney, who is from Red Deer.
Delaney will serve as CEO of the combined company and Gabel as president of its Canadian completion services division.
Pure Energy’s Red Deer operations are housed in three shops, while Canadian Sub-Surface currently leases premises at Blackfalds. Canadian Sub-Surface is constructing a new shop at Blackfalds, and Delaney said both companies’ Central Alberta operations are expected to operate there once it’s completed — likely by November.