It has been announced that Sandvik, an engineering group in tooling, materials technology, mining and construction, has acquired Varel International Energy Services for approximately $740 million USD. The acquisition is still subject to standard regulatory approvals and environmental due diligence.
Varel is an international supplier of drilling solutions such as drill bits and downhole products for well construction and serves a variety of industries including oil & gas, mining and construction. Although the company’s head quarters are located in Carrollton, Texas, some of its other manufacturing sites are located in Matamoros (Mexico), Aberdeen (Scotland), Tarbes (France) and Kurgan (Russia). In 2013 the company reported revenues of approximately $340 million USD and 1,300 employees. It is expected that Varel will form a new product area within the business area Sandvik Venture.
Tomas Nordahl, President of Sandvik Venture, has stated about the acquisition, “It forms a platform to enable Sandvik to enter into drilling solutions in the oil and gas sector. The combination of Varel’s solid market position and strong customer offering, and Sandvik’s broader drilling solutions capabilities as well as the extensive knowledge in highly relevant materials and cutting technology will support Varel’s continued growth.” He continued, “I am very impressed by the Varel team and I am excited about our joint opportunities going forward.”