MRC Global Inc. To Acquire Production Specialty Services
HOUSTON, Nov. 30, 2012
HOUSTON, Nov. 30, 2012 /PRNewswire/ -- MRC Global Inc. (NYSE:MRC) announced
today that the company's U.S. operating subsidiary, McJunkin Red Man
Corporation, has signed an agreement to acquire the operating assets of
Production Specialty Services, Inc. Headquartered in Midland, Texas and
established in 1990, Production Specialty Services supplies pipe, valves and
fittings as well as other MRO products to the oil and gas industry. Production
Specialty Services operates 17 service locations, including one distribution
center, in the Permian Basin and Eagle Ford shale regions of Texas and New
The Permian Basin is the most active oil drilling and production region in the
United States. Currently more than 425 rigs are operating within the region.
With the acquisition of Production Specialty Services' 17 locations, MRC will
have a service location network of 23 branches and one major distribution
center supporting the Permian Basin energy infrastructure activity.
"This acquisition is part of MRC's continued commitment to support our
customers' growth in a major oil producing region of the U.S.," Andrew R.
Lane, MRC Chairman, President and CEO, said. "We are pleased to have Ronnie
Crossland joining our regional management team and would like to welcome all
of the Production Specialty Services employees to MRC."
"The MRC culture of customer service and integrity was a key factor in our
decision to join with MRC," Ronnie Crossland, Production Specialty Services
President, said. "We know this is the right fit for the future of our company
and look forward to continuing to serve our customers with an expanded depth
of products and services throughout the Permian and Eagle Ford as part of
Production Specialty Services has projected 2012 revenue of $127 million. The
acquisition is subject to customary closing conditions, including the
expiration or early termination of the waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976.
More About MRC Global Inc.
Headquartered in Houston, Texas, MRC, a Fortune 500 company, is the largest
global distributor of pipe, valve, and fittings (PVF) and related products and
services to the energy industry, based on sales, and supplies these products
and services across each of the upstream, midstream and downstream sectors.
More information about MRC can be found at www.mrcglobal.com.
This news release contains forward-looking statements within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act. Words
such as "projected" and similar expressions are intended to identify
forward-looking statements. The company's expectations of the projected
revenue for Production Specialty Services Inc. are only the company's
expectations regarding this projection. Whether Production Specialty Services
is actually successful in achieving this projected revenue is dependent on a
number of factors, including (among others) changes in oil and natural gas
industry expenditure levels, which may result from changes in oil and natural
gas prices or other factors; increased usage of alternative fuels, which may
negatively affect oil and natural gas industry expenditure levels; U.S. and
international general economic conditions; Production Specialty Services'
ability to compete successfully with other companies in industry; risks that
customers may not desire to continue to business with Production Specialty
Services given the announcement of MRC's agreement to acquire Production
Specialty Services; the risk that manufacturers of the products Production
Specialty Services distributes will sell a substantial amount of goods
directly to end users in the industries it serves; unexpected supply
shortages; cost increases by the its suppliers; Production Specialty Services
lack of long-term contracts with most of its suppliers; increases in customer,
manufacturer and distributor inventory levels; suppliers' price reductions of
products that Production Specialty Services sells, which could cause the value
of its inventory to decline; decreases in steel prices, which could
significantly lower its profit; increases in steel prices, which it may be
unable to pass along to its customers, which could significantly lower its
profit; Production Specialty Services' lack of long-term contracts with many
of its customers and its lack of contracts with customers that require minimum
purchase volumes; changes in its customer and product mix; risks related to
its customers' credit; the potential adverse effects associated with
integrating Production Specialty Services into the company's business and
whether the acquisition will yield their intended benefits; changes in the
Production Specialty Services' credit profile; a decline in demand for certain
of the products that Production Specialty Services distributes if import
restrictions on these products are lifted; environmental, health and safety
laws and regulations; the sufficiency of its insurance policies to cover
losses, including liabilities arising from litigation; product liability
claims against the Production Specialty Services; the potential loss of key
personnel; interruption in the proper functioning of the Production Specialty
Services' information systems; loss of third-party transportation providers;
and risks related to adverse weather events or natural disasters.
Undue reliance should not be placed on the company's forward-looking
statements. Although forward-looking statements reflect the company's good
faith beliefs, reliance should not be placed on forward-looking statements
because they involve known and unknown risks, uncertainties and other factors,
which may cause the company's actual results, performance or achievements or
future events to differ materially from anticipated future results,
performance or achievements or future events expressed or implied by such
forward-looking statements. The company undertakes no obligation to publicly
update or revise any forward-looking statement, whether as a result of new
information, future events, changed circumstances or otherwise, except to the
extent required by law.
James E. Braun, EVP & Chief Financial Officer
MRC Global Inc.
Ken Dennard, Managing Partner
SOURCE MRC Global Inc.
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