CARPENTER TECHNOLOGY HEADLINESSteel Producers /
Carpenter Technology
Carpenter Technology Acquires Amega West Services
Jan. 4, 2011 Carpenter Technology Corp. has acquired Amega West Services, LLC, a Houston-based manufacturer and service provider of complex components for directional drilling equipment, for approximately $54 million.
The acquisition provides Carpenter with additional opportunities for selling specialty alloys into the growing oil & gas market, as Amega West is a leading manufacturer of high-precision components for measurement while drilling (MWD) and logging while drilling (LWD), drill collars, stabilizers and other down-hole tools used for directional drilling. Amega West is well known in the directional drilling industry for its high-precision machining, well-positioned rental fleet, and responsive customer service. Its management team has, in a short period of time, developed a reputation for high-quality products and outstanding service.
“We view energy as one of our fastest growing end-markets and we are expanding our portfolio of target applications in oil & gas and power generation,” said William A. Wulfsohn, President and CEO of Carpenter Technology. “In particular, we believe that global oil & gas demand will continue to rise and directional drilling activity, which uses a variety of our specialty alloys, will increase. This acquisition enables us to accelerate our participation in the growth of directional drilling and speeds up introduction of new alloys into the market.”
By combining its own specialty alloys with Amega West’s components and tools for directional drilling, Carpenter will create a more integrated supply chain for customers in the oil & gas market. Carpenter said it plans to expand Amega West’s manufacturing capacity at its Tyler, Texas, facility, as well as the rental fleet and the footprint of the company’s five North American service centers.
“We are much stronger as a combined company,” said Amega West President Reddy Godula. “Carpenter’s advanced alloys paired with Amega West’s ability to machine and service directional drilling equipment will enable us to provide more responsive, one-stop service to customers within this fast-growing market.”
Carpenter purchased Amega West from a group comprising Energy Special Situations Funds, other investors and certain Amega West employees. Amega West President Reddy Godula and Vice President Dave Overton will continue to manage Amega West’s operations. The transaction is expected to be modestly accretive to earnings in fiscal year 2011.
Carpenter Technology produces and distributes conventional and powder metal specialty alloys, including stainless steels, titanium alloys, tool steels and superalloys.