Transaction Reduces Nabors Net Debt by More Than 25%

HAMILTON, Bermuda, Aug. 20, 2025 /PRNewswire/ -- Nabors Industries Ltd. ("Nabors" or the "Company") (NYSE:NBR) today announced it has entered into a definitive agreement to sell Nabors' Quail Tools, LLC ("Quail") subsidiary to Superior Energy Services, Inc. ("Superior"). Net consideration for the sale totals $600 million plus adjustments for net working capital. Consideration is comprised of cash of $375 million and a seller note of $250 million. The Company expects to incur cash taxes on the sale of approximately $5 million, after using net operating loss carryforwards. The transaction will close today.

Since the close of the Parker transaction, the performance of Quail has exceeded Nabors' expectations even in challenging market conditions. Nabors currently estimates that Quail will generate adjusted EBITDA of approximately $150 million in 2025, excluding any synergies that Superior may realize.

Financial Rationale

• Original Parker Transaction

At the close of the Parker acquisition in March, Nabors estimated that for the full-year 2025, the Parker business would earn adjusted EBITDA of $150 million and incur capital expenditures of $80 million. The Company also expected to realize post-acquisition synergies of $40 million, resulting in free cash flow to Nabors of $80 million in 2025. To fund the acquisition, Nabors issued 4.8 million common shares at $37.50 per share and assumed approximately $93 million in net debt, as defined in the merger agreement. Total consideration of approximately $273 million was equivalent to 1.6 times expected 2025 adjusted EBITDA, including acquisition costs of $39 million and targeted synergies.

• Acceleration of free cash flow

Upon full realization of the net proceeds from this transaction, Nabors will be accelerating more than five years of anticipated free cash flow from the combined Parker businesses.

• Strengthens Nabors Balance Sheet

Upon full realization of the sale proceeds, Nabors expects net debt to decline by $625 million. As of June 30, 2025, Nabors reported long-term debt of $2.7 billion, and net debt of $2.3 billion. This transaction is expected to facilitate a reduction in net debt of more than 25%, and deliver annual interest savings in excess of $50 million, enhancing Nabors' financial flexibility.

• Additional Upside from Profitable and Growing Retained Businesses

Following the divestiture, Nabors will retain the drilling rig, O&M, and tubular running services operations acquired from Parker. Shortly following the close of the Parker acquisition, in the second quarter, Nabors completed the sale of idle Parker rig assets generating cash proceeds of approximately $35 million. Nabors expects the retained businesses to generate full-year 2025 adjusted EBITDA at a run rate of at least $55 million including realized 2025 post-closing synergies.

Net Positive Impact from Parker Acquisition and the Quail Disposition

The combined net effect of the Parker and Quail transactions to Nabors' legacy (pre- Parker) business is summarized as follows:

• Attributing proceeds of $625 million to the 4.8 million Nabors common shares issued, would result in a share issuance value of approximately $130 per share. 
   
• Additionally, the retained businesses are expected to contribute more than $55 million annual run-rate adjusted EBITDA. The implied net cost of acquiring this retained business is the assumed $93 million net debt, plus transaction costs of $39 million, less the $35 million in realized proceeds from asset sales, which totals $97 million and represents 1.8 times adjusted EBITDA. The retained business yields, at Nabors current valuation multiple (3.7 times 2025 consensus estimated EBITDA), additional implied equity value of $107 million, which translates into an additional $22 per issued share.