-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LXWC5RDhmwipXMlpCbHIkO3urC2wGdIK98MyhrKSOnJjCLCEabc/dTBhpV5M7ArR ReIeYmOSv4/Y5+SUCTiv+w== 0000950129-98-000067.txt : 19980109 0000950129-98-000067.hdr.sgml : 19980109 ACCESSION NUMBER: 0000950129-98-000067 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971230 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980108 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PARKER DRILLING CO /DE/ CENTRAL INDEX KEY: 0000076321 STANDARD INDUSTRIAL CLASSIFICATION: DRILLING OIL & GAS WELLS [1381] IRS NUMBER: 730618660 STATE OF INCORPORATION: DE FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-07573 FILM NUMBER: 98503035 BUSINESS ADDRESS: STREET 1: PARKER BLDG STREET 2: EIGHT E THIRD ST CITY: TULSA STATE: OK ZIP: 74103 BUSINESS PHONE: 9185858221 MAIL ADDRESS: STREET 1: PARKER BLDG STREET 2: EIGHT E THIRD ST CITY: TULSA STATE: OK ZIP: 74103 8-K 1 PARKER DRILLING COMPANY - DATED 12/30/97 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of earliest event reported: December 30, 1997 PARKER DRILLING COMPANY - -------------------------------------------------------------------------------- (Exact name or registrant as specified in its charter) Delaware 1-7573 73-0618660 - -------------------------------------------------------------------------------- (State of other jurisdiction Commission File Number (IRS Employer of incorporation) Identification No.) Eight East Third Street, Tulsa, Oklahoma 74103 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, include area code: (918) 585-8221 2 Item 2. Acquisition or Disposition of Assets On December 30, 1997, Parker Drilling Company completed the previously announced acquisition of Hercules Offshore Corporation and Hercules Rig Corp. The acquisition price of $195 million, plus $5 million for certain capital expenditures incurred subsequent to the definitive agreements' date of May 9, 1997, were financed through existing cash, together with $32 million borrowed under the revolving credit portion of Parker's Senior Credit Facility. A copy of the press release announcing the closing of the acquisition is annexed hereto as Exhibit 99 and incorporated herein by reference. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits (a) Financial Statements - The required historical financial statements were filed November 3, 1997 with the Company's Form 8-K. (b) Exhibits 2.1 Stock Purchase Agreement dated May 9, 1997 by and among the Company, Parker Drilling Offshore Company and Trenergy (Malaysia) BHD. (incorporated by reference to Exhibit 10(n) to the Company's Quarterly Report on Form 10-Q for the three months ended May 31, 1997). 2.2 Stock Purchase Agreement dated May 9, 1997 by and among the Company, Parker Drilling Offshore Company and Reshid & Lee Nominees SDN, BHD. (incorporated by reference to Exhibit 10(o) to the Company's Quarterly Report on Form 10-Q for the three months ended May 31, 1997). 99. Press Release dated December 30, 1997. 3 UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS The following unaudited pro forma combined financial information is derived from the historical financial statements of Parker, Mallard, Quail and Hercules, incorporated by reference herein, and certain assumptions deemed appropriate by the Company. The Unaudited Pro Forma Combined Statement of Operations for the year ended August 31, 1997 reflect: (i) the Mallard Acquisition, (ii) the Quail Acquisition, (iii) the Hercules Acquisition, (iv) the issuance of $300 million of 9 3/4% Senior Notes and $100 million of 7.94% term debt in November 1996, (v) the issuance of $25 million of convertible preferred stock in November 1996 and the subsequent conversion of such stock into 3,056,600 shares of Common Stock in December 1996, (vi) the issuance of $175 million of Convertible Notes in July 1997 and (vii) $32 million of additional borrowings under Parker's line of credit facility at a 7.94% interest rate, in each case as if such transactions had occurred on September 1, 1996. Such twelve months unaudited pro forma combined information combines: (i) the audited operating results for the Company for the fiscal year ended August 31, 1997, (ii) the unaudited operating results for Mallard and Quail for the period from September 1, 1996 to November 12, 1996 (the date of acquisition by Parker), and (iii) the combined unaudited operating results of Hercules for the 12 months ended September 30, 1997. The Hercules financial statements have been derived from the separate financial statements of HOC and HRC incorporated herein by reference and are presented on a combined basis with intercompany transactions between the entities eliminated. The unaudited pro forma combined financial information should be read in conjunction with the notes thereto and the historical financial statements of Parker, Mallard, Quail and Hercules, including the notes thereto. The pro forma adjustments giving effect to the various events described above are based upon currently available information and upon certain assumptions that management believes are reasonable. The historical operating results of Mallard included in the Unaudited Pro Forma Combined Financial Statements do not reflect any allocation of general corporate, accounting, tax, legal and other administrative costs incurred by its former parent corporation. The Company has not incurred any significant amount of additional general and administrative expense in connection with the incorporation of Mallard's and Quail's operations, and does not expect to incur any significant amount of such expenses in connection with the incorporation of Hercules' operations. The Mallard Acquisition and the Quail Acquisition have been, and the Hercules Acquisition will be, accounted for by the Company under the purchase method of accounting and the assets and liabilities of Mallard and Quail were, and the assets and liabilities of Hercules will be, recorded at their estimated fair market values at the date of acquisition. The unaudited pro forma combined financial information does not purport to be indicative of the results of operations that would actually have occurred if the transactions described had occurred as presented in such statements or that may be obtained in the future. In addition, future results may vary significantly from the results reflected in such statements due to general economic conditions, oil and gas commodity prices, the demand and prices for contract drilling services and rental tools, increases in the number of rigs available for service, the Company's ability to successfully integrate the operations of Mallard, Quail and Hercules with its current business and several other factors, many of which are beyond the Company's control. 4 PARKER DRILLING COMPANY AND SUBSIDIARIES UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS YEAR ENDED AUGUST 31, 1997 (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
HISTORICAL -------------------------------------------- SEPT. 1-NOV. 12, 1996 AS REPORTED ---------------- PRO PARKER(1) MALLARD QUAIL HERCULES(2) ADJUSTMENTS FORMA ----------- ------- ------ ----------- ----------- ---------- Revenues: Drilling........................ $ 283,598 $23,678 $ -- $64,251 $ (967)(1) $ 370,560 Rental.......................... 25,457 -- 5,387 -- -- 30,844 Other........................... 2,589 -- -- -- -- 2,589 ---------- ------- ------ ------- -------- ---------- Total revenues.............. 311,644 23,678 5,387 64,251 (967) 403,993 ---------- ------- ------ ------- -------- ---------- Operating expense: Drilling........................ 189,979 14,382 -- 39,090 7,253 (f) 250,615 (89)(1) Rental.......................... 8,549 -- 439 -- 739 (f) 9,727 Other........................... 4,722 -- -- -- -- 4,722 Depreciation, depletion and amortization.................. 46,256 2,695 505 5,715 5,360 (d) 61,153 810 (e) (188)(1) General and administrative...... 14,414 1,933 739 5,320 (7,992)(f) 14,414 ---------- ------- ------ ------- -------- ---------- Total operating expenses.... 263,920 19,010 1,683 50,125 5,893 340,631 ---------- ------- ------ ------- -------- ---------- Operating income.................. 47,724 4,668 3,704 14,126 (6,860) 63,362 ---------- ------- ------ ------- -------- ---------- Other income (expense): Interest expense................ (32,851) (102) -- (3,068) (2,541)(a) (52,399) (15,960)(g) (945)(j) 3,068 (h) Interest income................. 5,367 -- 962 -- (949)(i) 5,380 Other........................... 3,316 (78) 5 -- -- 3,243 ---------- ------- ------ ------- -------- ---------- Total other income (expense)................ (24,168) (180) 967 (3,068) (17,327) (43,776) ---------- ------- ------ ------- -------- ---------- Income before income taxes........ 23,556 4,488 4,671 11,058 (24,187) 19,586 ---------- ------- ------ ------- -------- ---------- Income tax expense (benefit)...... 7,241 403 -- 4,808 (4,846)(k) 7,371 (235)(l) ---------- ------- ------ ------- -------- ---------- Net income........................ $ 16,315 $ 4,085 $4,671 $ 6,250 $(19,106) $ 12,215 ========== ======= ====== ======= ======== ========== Earnings per share, primary and fully diluted................... $ .23 $ 0.17 ========== ========== Weighted average shares outstanding (fully diluted)..... 72,049,124 72,049,124 ========== ==========
- --------------- (1) Includes the operations of Malland and Quail from November 12, 1996 through August 31, 1997. (2) Reflects combined results of operations of HOC and HRC for the 12 months ended September 30, 1997. See Note (m) for the summary capsular combining statement of operations of HOC and HRC for the 12 months ended September 30, 1997. 5 PARKER DRILLING COMPANY AND SUBSIDIARIES UNAUDITED PRO FORMA COMBINED BALANCE SHEET (DOLLARS IN THOUSANDS) ASSETS
HISTORICAL ------------------------ PRO PARKER HERCULES(1) ADJUSTMENTS FORMA ---------- ----------- ----------- ---------- AS OF AS OF AUGUST 31, SEPT. 30, 1997 1997 ---------- ----------- Current assets: Cash and cash equivalents..................... $209,951 $ 498 $ 32,000 (a) $ 44,999 (200,502)(b) 3,052 (b) Other short-term investments.................. 2,838 2,838 Accounts and notes receivable................. 103,808 16,681 120,489 Rig materials and supplies.................... 19,130 19,130 Other current assets.......................... 16,227 2,659 (503)(b) 18,383 -------- -------- --------- ---------- Total current assets................... 351,954 19,838 (165,953) 205,839 -------- -------- --------- ---------- Property, plant and equipment: Drilling equipment............................ 723,878 94,077 51,311 (b,1) 869,266 Rental equipment.............................. 28,264 28,264 Buildings, land and improvements.............. 12,519 12,519 Other......................................... 21,586 203 21,789 Construction in progress...................... 28,640 8,411 37,051 -------- -------- --------- ---------- 814,887 102,691 51,311 968,889 Less accumulated depreciation, depletion and amortization................................ 375,236 8,257 (8,257)(d,l) 375,236 -------- -------- --------- ---------- Net property, plant and equipment............. 439,651 94,434 59,568 593,653 -------- -------- --------- ---------- Goodwill, net of accumulated amortization....... 139,467 16,260 21,355 (b,l) 177,082 -------- -------- --------- ---------- Other noncurrent assets......................... 53,064 885 53,949 -------- -------- --------- ---------- Total assets........................... $984,136 $131,417 $ (85,030) $1,030,523 ======== ======== ========= ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of long-term debt............. $ 16,084 $ 5,248 $ (5,078)(b) $ 16,254 Accounts payable.............................. 26,178 8,368 34,546 Accrued liabilities........................... 29,539 5,045 34,584 Accrued income taxes.......................... 4,904 804 5,708 -------- -------- --------- ---------- Total current liabilities.............. 76,705 19,465 (5,078) 91,092 -------- -------- --------- ---------- Long-term debt.................................. 551,042 33,413 32,000 (a) 583,042 (33,413)(b) Deferred income taxes........................... -- 10,133 (10,133)(b) Other long-term liabilities..................... 7,666 7,666 Preferred stock................................. -- 4,000 (4,000)(b) Stockholders' equity: Common stock.................................. 12,780 18,035 (18,035)(b) 12,780 Capital in excess of par value................ 340,243 39,598 (39,598)(b) 340,243 Retained earnings (accumulated deficit)....... (4,023) 6,773 (6,773)(b) (4,023) Other......................................... (277) (277) -------- -------- --------- ---------- Total stockholders' equity............. 348,723 64,406 (64,406) 348,723 -------- -------- --------- ---------- Total liabilities and stockholders' equity............................... $984,136 $131,417 $ (85,030) $1,030,523 ======== ======== ========= ==========
- --------------- (1) Represents the combined balances of HOC and HRC as of September 30, 1997. See note (c) for summary capsular combining balance sheet of HOC and HRC as of September 30, 1997. 6 PARKER DRILLING COMPANY AND SUBSIDIARIES NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS (a) To record $32.0 million of additional borrowings under the revolving credit portion of Parker's Senior Credit Facility at an interest rate of 7.94%. (b) To reflect the Hercules Acquisition. The purchase price was allocated as follows:
PURCHASE PRICE HERCULES -------------- -------- Cash........................................................ $200,002 Fees and expenses........................................... 500 -------- Total............................................. $200,502 ======== Purchase Price Allocation: Increase in property and equipment........................ 59,568 Working capital adjustment per purchase agreement......... 3,052 Eliminate stockholders' equity............................ 64,406 Reverse assets/liabilities which are not a part of acquisition: Debt and capital lease obligations........................ 38,491 Redeemable preferred stock................................ 4,000 Intangible assets......................................... (16,260) Deferred income taxes..................................... 9,630 Cost in excess of net assets acquired....................... 37,615 -------- $200,502 ========
(c) Following is the summary capsular combining balance sheets of HOC and HRC as of September 30, 1997.
HOC HRC ELIMINATIONS COMBINED -------- -------- ------------ -------- (DOLLARS IN THOUSANDS) Current assets........................... $ 19,488 $ 350 $ -- $ 19,838 Noncurrent assets........................ 88,994 24,765 (2,180) 111,579 -------- ------- ------- -------- Total assets................... 108,482 25,115 (2,180) 131,417 ======== ======= ======= ======== Current liabilities...................... $ 17,437 $ 2,028 -- $ 19,465 Noncurrent liabilities................... 31,198 14,528 (2,180) 43,546 Preferred stock.......................... 4,000 -- -- 4,000 Stockholders' equity..................... 55,847 8,559 -- 64,406 -------- ------- ------- -------- Total liabilities and stockholders' equity......... $108,482 $25,115 $(2,180) $131,417 ======== ======= ======= ========
The eliminations represent approximately $2,180,000 of HRC's note payable to HOC as of September 30, 1997. (d) To adjust depreciation expense on assets acquired using allocated purchase price and to eliminate accumulated depreciation on Hercules assets. Depreciation was calculated over 17 1/2 years for barge drilling rigs, 15 years on jackup rigs and seven years for tool rental equipment, using 5% salvage on all equipment. (e) Amortization of excess cost over fair value of net assets acquired over 30 years. (f) Reclassify the general and administrative expenses of Mallard and Hercules to drilling expense and of Quail to rental expense. (g) To record interest expenses related to $300 million of 9 3/4% Senior Notes, $175 million of Convertible Notes at 5.5%, and $100 million of term debt at a rate of 7.94%. 7 (h) Eliminate interest expense on Hercules debt not assumed. (i) Eliminate interest and investment income on Quail cash and investments not acquired. (j) Amortization of original issue discount and debt issuance costs over the ten-year term of the 9 3/4% Senior Notes and the seven-year term of the Convertible Notes. (k) Eliminate U.S. federal income taxes allocated to Mallard by its former parent and eliminate U.S. federal income taxes recorded by Hercules due to the existence of the Company's net operating loss tax carryforwards. (l) Eliminate operating results and balance sheet accounts related to Rig No. 1 which was sold by Hercules subsequent to September 30, 1997. (m) Following is the summary capsular combining statements of operations of HOC and HRC, as applicable for the period indicated:
TWELVE MONTHS ENDED SEPTEMBER 30, 1997 ----------------------------------------------- HOC HRC ELIMINATIONS COMBINED ------------ ------ ------------ -------- (DOLLARS IN THOUSANDS) Revenues...................................... $64,251 $1,923 $(1,923) $64,251 Total operating expenses...................... 50,621 1,427 (1,923) 50,125 Other (income) expense........................ 2,013 1,055 -- 3,068 Income (loss) before income taxes............. 11,617 (559) -- 11,058 Income tax expenses........................... 4,808 -- -- 4,808 ------- ------ ------- ------- Net income (loss)............................. $ 6,809 $ (559) $ -- $ 6,250 ======= ====== ======= =======
Elimination entries represent the elimination of approximately $1,923,000 of HRC's billings to HOC for the twelve months ended September 30, 1997 for HOC's bareboat charter of HRC's drilling and workover rigs. 8 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. PARKER DRILLING COMPANY By: /s/ James J. Davis ----------------------------------- James J. Davis Senior Vice President - Finance and Chief Executive Officer Date: January 8, 1998 9 INDEX TO EXHIBITS Exhibit Number Description - ------ ----------- 2.1 Stock Purchase Agreement dated May 9, 1997 by and among the Company, Parker Drilling Offshore Company and Trenergy (Malaysia) BHD. (incorporated by reference to Exhibit 10(n) to the Company's Quarterly Report on Form 10-Q for the three months ended May 31, 1997). 2.2 Stock Purchase Agreement dated May 9, 1997 by and among the Company, Parker Drilling Offshore Company and Reshid & Lee Nominees SDN, BHD. (incorporated by reference to Exhibit 10(o) to the Company's Quarterly Report on Form 10-Q for the three months ended May 31, 1997). 99 Press Release dated December 30, 1997. EX-99 2 PRESS RELEASE DATED 12/30/97 1 EXHIBIT 99 [LOGO] PARKERNEWS Parker Drilling Company Parker Building, Eight East Third Street, Tulsa Oklahoma 74103 (918) 585-8221 - -------------------------------------------------------------------------------- FOR IMMEDIATE RELEASE FOR FURTHER INFORMATION, CONTACT: Tim Colwell, 918-631-1249 PARKER DRILLING CLOSES ON ACQUISITION OF HERCULES OFFSHORE (Tulsa, Okla., Dec. 30, 1997) - Parker Drilling Company (NYSE: PKD) today announced that it has completed its acquisition of Hercules Offshore Corporation and Hercules Rig Corp. Hercules Offshore Corporation, a Houston-based offshore drilling contractor, was owned by Trenergy (Malaysia) BHD, and Hercules Rig Corp. was owned by private Malaysian interests. The purchase includes seven jackup rigs and three self-erecting platform rigs operating in the Gulf of Mexico. All the rigs are under contract except one jackup rig, which is currently being refurbished. "Hercules has an excellent reputation in the Gulf of Mexico market," said Robert L. Parker, Jr., president and chief executive officer. "We are excited to welcome this company to the Parker family. Our plan is to grow the company, and expand its operations into international markets where Parker Drilling has an active presence," he added. Hercules is the fourth major acquisition by Parker in the past 13 months. In November 1996, the Tulsa-based company acquired two offshore niche companies, Mallard Drilling and Quail Tools. In August, Parker purchased the assets of Bolivia's largest private drilling contractor, Bolifor, S.A. -----END PRIVACY-ENHANCED MESSAGE-----