VERNAL, Utah - Superior Drilling Products (NYSE:SDPI), Inc. (NYSE American: SDPI), a designer and manufacturer of drilling tool technologies, announced Monday that its shareholders overwhelmingly voted in favor of the company's acquisition by Drilling Tools International Corporation (Nasdaq: DTI). More than 99% of the votes cast, representing about 77% of SDP's outstanding shares, were in favor of the merger agreement.
The special meeting of shareholders, which took place yesterday, marked a significant step towards finalizing the deal. Troy Meier, Chairman and CEO of SDP, expressed gratitude for the shareholder support and emphasized the potential benefits of the merger, stating, "Their confidence reflects a shared recognition of the tremendous opportunities ahead as a combined company."
The transaction is expected to close on August 1, 2024. Following the completion of the merger, SDP’s common stock will be delisted from public markets. Final vote results will be filed with the U.S. Securities and Exchange Commission on a Form 8-K as certified by the independent Inspector of Election.
Superior Drilling Products is known for providing cost-saving solutions that enhance production efficiencies in the oil and natural gas drilling industry. Their portfolio includes patented technologies such as the Drill-N-Ream® well bore conditioning tool and the Strider™ oscillation system. SDP also manufactures and refurbishes PDC (polycrystalline diamond compact) drill bits for major oil field service companies.
This merger is subject to customary closing conditions, including regulatory approvals. The forward-looking statements in this announcement detail certain expectations and projections about the merger, but actual results could differ materially due to various risks and uncertainties. These include but are not limited to market conditions, government regulations, and the impact of the COVID-19 pandemic on the industry.
The information in this article is based on a press release statement from Superior Drilling Products, Inc.
In other recent news, Drilling Tools International Corp. has seen significant developments. The company is set to join several Russell indexes, including the Russell 2000®, Russell 2500®, Russell 3000®, Russell Small Cap Completeness® Index, and Russell Microcap® Index, following their annual reconstitution. This inclusion, expected to commence at the end of June, is seen as an acknowledgment of the company's robust foundation and performance.
The company has also recently secured $105 million in financing, bolstering its financial position. This was achieved through an amendment to its existing credit facility with PNC Business Credit, which increased from $60 million to $80 million, and the procurement of a new $25 million term loan with PNC. These funds are intended to support the company's growth initiatives and international expansion.
These are recent developments that could enhance Drilling Tools International's visibility among investment managers and institutional investors. The transactions were legally advised by Winston & Strawn for Drilling Tools International and Holland & Knight for PNC Business Credit.
InvestingPro Insights
As Superior Drilling Products, Inc. (NYSE American: SDPI) prepares to join forces with Drilling Tools International Corporation, a look at the InvestingPro data reveals some compelling financial metrics. The company boasts a market capitalization of $159.26 million, underlining its considerable presence in the drilling tool technologies sector.
With a Price/Earnings (P/E) ratio of 13.09 and an adjusted P/E ratio for the last twelve months as of Q1 2024 at 12.72, SDP is positioned at a favorable valuation relative to earnings. Additionally, the company's Gross Profit Margin for the same period stands at a robust 76.64%, highlighting its efficiency in managing production costs relative to sales.
InvestingPro Tips also shed light on the company's financial health and market performance. Notably, SDP has been profitable over the last twelve months, and analysts predict the company will continue this trend into the current year. Furthermore, the company's liquid assets exceed its short-term obligations, providing it with a solid liquidity position. This is particularly relevant as the firm approaches its merger, ensuring that it has the financial stability to support the transition.
For investors interested in deeper analysis and additional InvestingPro Tips, such as insights into the company's moderate level of debt and its recent significant price uptick over the last six months, Superior Drilling Products' profile on InvestingPro offers a comprehensive suite of metrics and professional insights.
To explore these further and benefit from the full range of features, use coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription. There are 6 additional InvestingPro Tips available that could provide valuable context for SDP's financial landscape and future prospects.
The merger, which is expected to close on August 1, 2024, represents a pivotal moment for SDP. As the company moves towards this significant milestone, the InvestingPro data and tips provide a snapshot of its financial health and market position, offering stakeholders and potential investors a clearer understanding of what lies ahead.
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