Wdesk | Sale of Engineered Chemistry and Drilling Fluids
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 30, 2014
Weatherford International public limited company
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation)
(Commission File Number)
(I.R.S. Employer Identification No.)
Bahnhofstrasse 1, 6340 Baar, Switzerland
(Address of principal executive offices)
Registrant’s telephone number, including area code: +41.22.816.1500
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Entry into a Material Definitive Agreement.
On November 30, 2014, Weatherford International plc (“Weatherford”), through a wholly-owned subsidiary, entered into an agreement (the “Acquisition Agreement”) to sell its engineered chemistry and Integrity drilling fluids businesses to LZ Holding Corporation, an affiliate of The Lubrizol Corporation, a Berkshire Hathaway company. The businesses will be sold for $750 million in cash, subject to customary purchase price adjustments, plus a potential increase of $75 million for an earnout that is tied to the post-closing performance of the businesses (the “Divestiture”). The Divestiture is subject to satisfactory completion of certain customary closing conditions, including antitrust regulatory approvals. Upon closing, Weatherford expects to use the proceeds from the closing of the sale to repay debt.
The foregoing description of the Acquisition Agreement does not purport to be complete and is qualified in its entirety by reference to the Acquisition Agreement, a copy of which will be filed with Weatherford’s Annual Report on Form 10-K for the year ended December 31, 2014.
A copy of the press release announcing the Divestiture is attached hereto as Exhibit 99.1.
Financial Statements and Exhibits.
(d) The exhibit listed below is furnished pursuant to Item 9.01 of this Form 8-K.
News release dated December 1, 2014 announcing the Divestiture.
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.
Weatherford International plc
Date: December 1, 2014
/s/ Krishna Shivram
Executive Vice President and
Chief Financial Officer
INDEX TO EXHIBIT
News release dated December 1, 2014 announcing the Divestiture.
Wdesk | EX 99.1 Press Release Sale of Engineered Chemistry and Drilling Fluids Businesses
Weatherford to Sell its Engineered Chemistry and Drilling Fluids Businesses
for $825 Million in Cash and Earnout
BAAR, Switzerland, December 1, 2014 – Weatherford International plc (NYSE: WFT) (the “Company”) has signed a definitive agreement with an affiliate of The Lubrizol Corporation (“Lubrizol”), a Berkshire Hathaway company, for the sale of the Company’s engineered chemistry and Integrity drilling fluids business. The businesses will be sold for $750 million in cash, subject to customary purchase price adjustments, plus a potential increase of $75 million for an earnout that is tied to the post-closing performance of the businesses.
Weatherford’s engineered chemistry business provides chemical treatments for oil and gas production and produced waters as well as additives for drilling, workover and stimulation operations, while its Integrity drilling fluids business includes drilling fluid systems and additives for enhanced performance of drilling operations. The sale is subject to customary closing conditions and regulatory approvals and is expected to close before year end 2014. Proceeds from the sale will be used to pay down debt.
Bernard J. Duroc-Danner, Chairman, President and Chief Executive Officer of Weatherford stated: “The agreement is another step in Weatherford’s previously announced plans to divest the Company’s non-core businesses. This transaction brings our realized cash divestiture proceeds to approximately $1.8 billion during 2014 and implies that our net debt will range between $6.6 billion to $6.8 billion at year end 2014. This is substantial progress. These divested businesses represent attractive growth platforms for Lubrizol, a technology-driven specialty chemicals company with strong leadership and innovation. The transaction provides Lubrizol the opportunity to leverage Weatherford’s oilfield engineered chemistry and fluid expertise to the benefit of its clients.”
“I am very pleased with the growth prospects represented by this proposed acquisition” said James L. Hambrick, Lubrizol Chairman, President and Chief Executive Officer. “For us, it is a decisive move into a large adjacent market space that, we believe, will value the combined technologies, fluid formulation capabilities and applications knowledge of our legacy and newly acquired businesses. We look forward to being an essential and valued solutions provider to multinational and regional oilfield service companies.”
Weatherford is one of the largest multinational oilfield service companies. Weatherford’s product and service portfolio spans the lifecycle of the well, and includes Well Construction, Formation Evaluation, Completion and Artificial Lift. The Company provides innovative solutions, technology and services to the oil and gas industry, and operates in over 100 countries.
Executive Vice President and Chief Financial Officer
Vice President – Investor Relations
This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are generally identified by the words “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “may,” “should,” “could,” “will,” “would,” and “will be,” and similar expressions, although not all forward-looking statements contain these identifying words. Such statements are subject to significant risks, assumptions and uncertainties. Specifically, statements regarding the use of proceeds and the timing of closing of the transaction described herein assume that there will be no subsequent events or other adverse developments after the date of this press release that would preclude or otherwise affect closing. Forward-looking statements also are affected by the risk factors described in Weatherford’s Annual Report on Form 10-K for the year ended December 31, 2013, and those set forth from time-to-time in other filings with the Securities and Exchange Commission. Weatherford undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the extent required under federal securities laws.