A Denver-based oil-field services company has bought Oklahoma City's Canary Wellhead Equipment Inc. and will rebrand the combined company with the Canary name.
Frontier Energy Group CEO Dan Eberhart said the new company, Canary LLC, will be based in Denver. It will keep its Oklahoma operations and could base its distribution in Oklahoma City.
Terms of the deal weren't disclosed.
Eberhart said the combined company will have annual revenues of more than $100 million and 300 employees. About 100 employees are in Oklahoma at a manufacturing plant in Shawnee and at a remanufacturing plant in Oklahoma City.
“These guys have a really strong reputation, and they're in a bunch of different markets,” Eberhart said of Canary. “We were primarily in the Rockies, so we thought it would be a good fit and help it be a merger of equals as opposed to an acquisition that's top-down.”
Eberhart said Canary will have 26 locations across the country and customers in every major shale play, including the Bakken in North Dakota, the Woodford in Oklahoma, the Utica in Ohio and the Niobrara in Colorado. The combined company will be the largest independent wellhead company in the country, he said.
“What you're going to see is us hiring more people locally to expand here,” Eberhart said of Oklahoma City. “We're looking to expand the manufacturing and remanufacturing, and take some of the stuff we've historically given to third-parties and do it in-house with Canary. We're also looking to piggyback on their distribution system and make Oklahoma City the distribution center for the combined company.”
Co-founders Lynn Blevins and Jim Chappell started Canary in 1984. The company's name came from its canary yellow equipment. Blevins and Chappell will join the new company as vice presidents.
“We started out as a remanufacturing business, and we went on to get into the manufacturing business,” Chappell said. “Now we're manufacturing our own equipment and importing equipment from outside the United States.”
Chappell said he and Blevins were looking for a potential buyer.
“I'd met Dan (Eberhart) quite some years ago, and he remembered our company,” Chappell said. “He actually came to us. It worked out quite well.”
The Canary acquisition is the eighth for the former Frontier Energy Group in the last four years. Eberhart said the private company plans to continue acquisitions and may have an initial public offering.
“I was actually in New York talking to those types of folks yesterday,” Eberhart said Tuesday.
“I think that's something we would potentially look at, not something that's imminent whatsoever,” Eberhart said.