NEWS BRIEF: Utah-based Superior Drilling Products has been Acquired for $32.2 Million in Cash and Stock

Vernal, Utah-based Superior Drilling Products, previously NASDAQ:SPDI, has been acquired by Houston, Texas-based Drilling Tools International (NASDAQ:DTI) for $32.2 million in cash and stock.

DTI is a global oilfield services company, and according to its acquisition news release, one of the benefits of acquiring 31-year-old Superior Drilling is the fact that DTI gains ~$6.6 million in receivables through the purchase, reducing the effectual acquisition cost by over 20%.

As outlined in the DTI Form 8-K filed with the U.S. Securities and Exchange Commission, DTI paid Superior Drilling shareholders $14.9 million in cash and issued them nearly 4.85 million new shares of DTI common stock to acquire Superior Drilling.

As described on its LinkedIn profile, Superior Drilling is a 31-year-old firm known for its "... innovative, cutting-edge PDC (polycrystalline diamond compact) drill bits, and a designer and manufacturer of new drill bit and horizontal drill string enhancement tools for the oil, natural gas and mining services industries."

In describing DTI's acquisition of Superior Drilling, DTI Chief Executive Officer Wayne Prejean said:

"SDP's unique offering of proprietary diamond process expertise, sophisticated manufacturing capabilities, and their recently established Middle East footprint will greatly benefit DTI's technology focused product and service offering on a global scale."

In its investor presentation for its second quarter (ended 30 June 2024), DTI further explained that the Superior Drilling acquisition enhances its vertical integration in differentiated technologies and accelerates global growth opportunities. (See slide below.)

DTI generated $152 million in revenue in 2023, ended December 31, and projects that even with revenue softness through the first half of 2024, it will produce between $155 million and $170 million this year.

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