Western Lakota Energy Services Inc.
TSX : WLE

Western Lakota Energy Services Inc.

June 27, 2005 15:47 ET

Western Lakota Closes Acquisition of Four Rigs

CALGARY, ALBERTA--(CCNMatthews - June 27, 2005) - Western Lakota Energy Services Inc. (TSX:WLE) announces the closing of the previously announced acquisition of four surface casing/core drilling rigs and related spare equipment from Becker Drilling Inc. of Airdrie, Alberta. Brad and Graham Becker have also joined the management team of Western Lakota to operate these rigs.

Revenue of the four rigs for the most recent 12 month period is approximately $12.0 million and the earnings before interest, tax, depreciation and amortization (EBITDA) are calculated at approximately $3.6 million. All of the rigs are currently contracted and Western Lakota is prepared to fulfill these contracts. All of the Becker field employees will be offered employment with Western Lakota.

The purchase price of $12.63 million, which was equivalent to 3.5 times trailing EBITDA, was paid by the issuance of 392,157 common shares of Western Lakota Energy Services Inc. at a deemed issue price of $6.63 per share, $4 million from a new bank credit facility, and $6.03 million from cash generated from operations.

"Graham and Brad Becker have done a great job managing these rigs and we are pleased that they will be joining Western Lakota," said Elson McDougald. "These rigs represent a growth area in the industry and diversify our strong fleet of existing rigs."

One of Canada's fastest-growing drilling contractors, Western Lakota currently operates 22 rigs and, in addition to the four surface casing/core drilling rigs in this acquisition, plans to build 8 more rigs by the end of 2005. Western Lakota continues to provide one of the newest fleets of safe and efficient drilling rigs in Canada while delivering strong results for shareholders, customers and Aboriginal partners.


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