TMX group

Deal provides enhanced service and technology offerings

HOUSTON, TX, June 6 /CNW/ - Weatherford International Ltd. (NYSE:WFT)
today announced that the company has signed a definitive agreement to purchase
Precision Drilling Corporation's Energy Services Division and International
Contract Drilling Division.
Under the terms of the agreement, Weatherford will pay approximately  
US$2.28 billion, consisting of 26 million Weatherford common shares and
approximately US$900 million in cash, based on current exchange rates. The
cash portion of the consideration is payable in Canadian dollars. Acquired net
book value is about US$1.63 billion. Weatherford expects the transaction to be
accretive to its earnings per share and cash flow per share for 2005, before
consideration of potential synergies.
Precision's Energy Services division is a global provider of cased hole
and open hole wireline services, drilling and evaluation services (directional
drilling, MWD, LWD and rotary steerable systems) and production services
(primarily underbalanced drilling). Weatherford's cased hole wireline and
underbalanced segments will be consolidated and strengthened by this
transaction. Furthermore, the transaction will substantially broaden the
company's open hole wireline and directional capabilities.
Precision's International Contract Drilling division is an international
land rig contractor. It became a major player in the international market
after its acquisition of the worldwide land drilling assets of Global Santa Fe
Corporation in May 2004. Precision currently has 48 rigs, with a strong
presence in the Middle East/North Africa. The land drilling assets being
acquired are among the best in the industry and further bolster Weatherford's
already strong presence in the Middle East. The availability of these assets
will allow the company to further meet customers' bundling needs in the
region.
Precision has developed innovative technologies which Weatherford is
anxious to harvest. Weatherford will endeavor to accelerate the growth of
these technologies with the full support of its worldwide infrastructure. Post-
acquisition, the company will offer a comprehensive suite of products and
services with leading technology.
In the twelve months ended December 2004, Precision Energy Services and
International Drilling had revenues of C$1.1 billion. The combined divisions
have approximately 5,300 employees operating in 25 countries.
Hank B. Swartout, Chairman, President and Chief Executive Officer of
Precision stated, "This transaction is the result of an extensive process
undertaken by the board of directors to explore possible avenues of value
creation for our shareholders. After careful consideration of various
strategic alternatives, the board determined this opportunity to be the best
for our shareholders and for employees of the respective divisions. We believe
the strategic fit with Weatherford will strengthen their global presence and
provide opportunities for all stakeholders affected by this expanded
Weatherford organization - shareholders, customers and employees. It is
currently anticipated that a portion of the consideration received by
Precision will be distributed to our shareholders following completion of the
sale."
Bernard J. Duroc-Danner, Chairman, President and Chief Executive Officer
of Weatherford commented, "What we are adding from Precision consolidates,
strengthens and broadens critical segments of our business. Weatherford in
turn will provide the Precision operations with the full support of our
infrastructure, in particular in the Eastern Hemisphere. This is a growth
strategy for shareholder value."
The transaction is expected to be completed during the third quarter of
2005 and is subject to regulatory approvals, including U.S. and Canadian
competition filings, and to other customary closing conditions.
UBS Investment Bank acted as exclusive financial advisor to Precision.
Simmons & Company International and Goldman, Sachs & Co. acted as financial
advisors to Weatherford.
The company will host a conference call to discuss the acquisition
this morning at 8:00 a.m. (CDT). The company invites investors to listen
to a play back of the conference call at the company's website,
http://www.weatherford.com in the "investor relations" section. The call
will be open to the public.
To access the call please contact the conference call operator at     
800-901-5248, or 617-786-4512 for international calls, approximately 10
minutes prior to the scheduled start time, and ask for the Weatherford
conference call. The passcode is "Weatherford". A replay will be available
until 5:00 p.m. central, June 13, 2005. The number for the replay is       
888-286-8010, or 617-801-6888 for international calls; passcode 88618607.
The issuance of the Weatherford common shares in the transaction to
Precision will not be registered under the Securities Act of 1933 and may not
be offered or sold by Precision in the United States absent registration or an
applicable exemption from registration. Weatherford has agreed to file a
registration statement with the Securities and Exchange Commission to register
the distribution of the shares by Precision to its shareholders.
Weatherford is one of the largest global providers of innovative
mechanical solutions, technology and services for the drilling and production
sectors of the oil and gas industry. Weatherford operates in over 100
countries and employs more than 18,000 people worldwide.
Precision Drilling Corporation is a global contract drilling and
oilfield services company providing a broad range of drilling, production
and evaluation services with focus on fulfilling customer needs through    
fit-for-purpose technologies for the maturing oilfields of the 21st century.
Precision employs more than 12,000 people in more than 30 countries.




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