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JFE Steel and Kanematsu Acquire Premium Threading Business in U.S. for US$91.5 Million
10/23/2012 - JFE Steel Corporation announced it is decided to acquire the premium threading business and related assets of U.S.-based Benoit Machine LLC through a holding company, Benoit Holding Company, which has been jointly established by JFE Steel and Kanematsu USA Inc., a wholly owned subsidiary of Kanematsu Corporation in Japan.
JFE Steel Corporation announced that it is decided to acquire the premium threading business and related assets of U.S.-based Benoit Machine LLC through a holding company, Benoit Holding Company, which has been jointly established by JFE Steel and Kanematsu USA Inc., a wholly owned subsidiary of Kanematsu Corporation in Japan.
JFE will package its own threads with those of the new company, Benoit Premium Threading, LLC, and will leverage the JFE global network to help the new company increase its sales of oilfield tubing in market outside the United States. JFE also expects to increase its own sales volume for oilfield tubing by supplying these products to the new company.
Louisiana-based Benoit provides premium threading services for oilfield tubing and a full line of downhole accessories. Benoit Two-Step (BTS), a proprietary premium connection that eliminates high connection stress and minimizes galling through a two-step parallel design, has been used by major oil companies for over 30 years, helping Benoit to maintain a large market share.
The acquisition, with a purchase price of US$91.5 million, will enable JFE Steel and Kanematsu to establish a total supply chain for the manufacture, threading and distribution of oilfield tubing and downhole accessories, and thereby meet diversified needs in the oil and gas industry and capture growing demand for oilfield tubing going forward.
Exploration and production of energy resources in the U.S. are expected to grow over the medium and long terms. Continued development of shale oil and shale gas, as well as deepwater production in the Gulf of Mexico, should fuel robust demand for oilfield tubing.
JFE will package its own threads with those of the new company, Benoit Premium Threading, LLC, and will leverage the JFE global network to help the new company increase its sales of oilfield tubing in market outside the United States. JFE also expects to increase its own sales volume for oilfield tubing by supplying these products to the new company.
Louisiana-based Benoit provides premium threading services for oilfield tubing and a full line of downhole accessories. Benoit Two-Step (BTS), a proprietary premium connection that eliminates high connection stress and minimizes galling through a two-step parallel design, has been used by major oil companies for over 30 years, helping Benoit to maintain a large market share.
The acquisition, with a purchase price of US$91.5 million, will enable JFE Steel and Kanematsu to establish a total supply chain for the manufacture, threading and distribution of oilfield tubing and downhole accessories, and thereby meet diversified needs in the oil and gas industry and capture growing demand for oilfield tubing going forward.
Exploration and production of energy resources in the U.S. are expected to grow over the medium and long terms. Continued development of shale oil and shale gas, as well as deepwater production in the Gulf of Mexico, should fuel robust demand for oilfield tubing.
