Cordy Oilfield Services Inc.
TSX VENTURE : CKK

Cordy Oilfield Services Inc.

August 01, 2006 09:30 ET

Cordy Announces Completion of Acquisition of Battle River Oilfield Construction Ltd. and Lamont Bit Services Ltd.

CALGARY, ALBERTA--(CCNMatthews - Aug. 1, 2006) - Cordy Oilfield Services Inc. (the Corporation) (TSX VENTURE:CKK) pleased to announce that it has completed the purchase, directly or indirectly, (collectively, the "Transactions") of all of the issued and outstanding securities of each of Battle River Oilfield Construction Ltd. ("Battle River") and Lamont Bit Services Ltd. ("Lamont").

Upon completion of the Transactions, there are issued and outstanding approximately 76.7 million common shares ("Cordy Shares") of the Corporation.

Battle River

Battle River, established in 1984, provides construction services to oil and natural gas producers in the northwestern area of Alberta. Battle River operates out of Manning, Alberta with 50 pieces of heavy-duty machinery and employs as many as 175 people. Bill May, Keith Hutchinson, Dave Willans and Jared May are the senior managers and majority owners of Battle River. All four will continue in their respective management roles with Battle River following the completion of its acquisition by the Corporation.

The purchase price for Battle River was $25,153,038 made up of $11,028,028 in cash and $14,125,001 by way of the issuance of 2,959,524 Cordy Shares at the deemed price of $5.25 per share. The Corporation also granted to the vendors a right to acquire, for no further consideration, up to an additional 594,408 Cordy Shares based on a market price adjustment based upon trading prices for the 60 day period ending February 1, 2007. The Corporation also granted 875,000 options to purchase Cordy Shares with an exercise price of $3.80 to employees of Battle River.

Lamont

Lamont, established in 1976, is a Calgary based drill bit and down hole tool sales and manufacturing company. Lamont is presently owned by the Lamont family and managed by Fred A. Lamont who will continue to manage the Lamont operation following the completion of its acquisition by the Corporation.

The purchase price for Lamont was $4,325,341.00 made up of $2,000,000 cash and $2,325,341.00 by way of the issuance of 442,922 Cordy Shares at the deemed price of $5.25 per share. The Corporation also granted 150,000 options to purchase Cordy Shares with an exercise price of $3.80 to employees of Lamont.

The Corporation's President and CEO Sid Dutchak describes the purchase of Lamont as "synergistic" and complementary to the business conducted by recently acquired Sphere Drilling Fluids Ltd. of Calgary. "Our acquisition of Lamont and Sphere will enable us to provide our customers with an expanded array of products and services while achieving operational efficiencies."

Sid Dutchak indicates that the purchase of Battle River is a positive and strategic addition to the Cordy group of companies. "Battle River is a highly successful company in the Peace Country region, an area with outstanding potential. We will focus upon expanding business by building working relationships between Battle River and Cordy's other operations."

The TSX Venture Exchange has in no way passed upon the merits of the Transactions and has neither approved nor disapproved of the contents of this press release. The Transactions are subject to approval by the Exchange.

The Corporation owns businesses in the oilfield services and construction sectors and is implementing a strategy of growth through acquisition.

The TSX Venture Exchange has not reviewed, and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Cordy Oilfield Services Inc.
    Sid Dutchak
    President
    (403) 266-2067
    Email: sdutchak@cordy.ca
    or
    For investor relations information:
    Cordy Oilfield Services Inc.
    David Orr
    Vice President - Corporate Development
    Email: dorr@cordy.ca
    Website: www.cordy.ca