Star Equity Holdings Acquires Alliance Drilling Tools for $12.65 Million
Deal News | Mar 04, 2025 | Globenewswire
Star Equity Holdings, a diversified holding company, has completed its acquisition of Alliance Drilling Tools (ADT), a company specializing in the supply and repair of drilling equipment for the oil, gas, geothermal, mining, and water-well sectors. The transaction, worth $12.65 million on a cash-free, debt-free basis, includes a mix of cash and Star's preferred stock. ADT's previous year's revenue was approximately $10.5 million with an adjusted EBITDA of $2.4 million. As part of the acquisition, Star plans to initiate a sale-leaseback process for ADT's real estate, valued at a minimum of $3 million. ADT will retain its brand name and continue as a new division under Star's Energy Services. Star views this acquisition as a means to expand its portfolio and accelerate ADT's growth through strategic investments.
Sectors
- Oil and Gas Equipment & Services
- Mining & Geothermal
- Building Solutions & Energy
Geography
- United States – Both Star Equity Holdings and Alliance Drilling Tools operate primarily within the United States, with facilities in Texas, Wyoming, and Utah.
Industry
- Oil and Gas Equipment & Services – The acquisition involves Alliance Drilling Tools, which supplies and repairs drilling equipment for the oil and gas industry.
- Mining & Geothermal – Alliance Drilling Tools also serves the mining and geothermal sectors, providing necessary equipment and repair services.
- Building Solutions & Energy – Star Equity Holdings operates in building solutions and energy, reflected in its diversification through this acquisition.
Financials
- 12.65 million – The enterprise value of ADT on a cash-free, debt-free basis as part of the acquisition.
- 4.9 million – Total cash component funded in part by $2.5 million of debt financing.
- 7.75 million – Value of 775,000 shares of Star's Series A Preferred Stock included in the transaction.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Star Equity Holdings, Inc. | Acquirer | Company | A diversified holding company engaged in building solutions, energy services, and investments. |
| Alliance Drilling Tools, LLC | Target | Company | A Wyoming- and Texas-based company specializing in drilling equipment supply and repair. |
| Rick Coleman | CEO of Star Equity Holdings | Person | CEO overseeing the strategic growth of Star Equity Holdings. |
| Bruce McGovern | President and Founder of Alliance Drilling Tools | Person | Founder of ADT, involved in the company’s growth trajectory. |
| Jeff Eberwein | Executive Chairman of Star Equity Holdings | Person | Executive Chairman involved in overseeing corporate strategies and acquisitions. |