(MENAFN - ProactiveInvestors - Australia) Titan Energy Services (ASX: TTN) is expanding the services it provides to the coal seam gas sector with the A21.7 million acquisition of Queensland-based Hofco Oilfield Services.
The acquisition will be funded by a new equity raising for up to 18 million and operating cash flow.
Hofco, a leading directional drilling equipment and down-hole tool rental provider, has pro-forma 2013 financial year forecasts of 8.5 million in revenue and 5.1 million of earnings.
Its key executives have agreed to remain within the business for at least two years to grow the company and integrate it within the Titan group.
Completion of the acquisition is subject to Titan obtaining sufficient funding by 15 March 2013 and customary conditions precedent.
Titan has already raised 11 million through a placement of shares priced at 1.05 each to sophisticated, professional and other investors.
It will seek another 7 million through a fully underwritten pro-rata non-renounceable entitlement offer of one new share for every four shares held. These shares will be priced at 0.95 each.
The remaining 3.7 million will be paid out from the company's existing cash resources.