Bronco to pay Allis-Chalmers $4.5 million after proposed merger terminated

By Lisa Kerner

Charlotte, N.C., Aug. 8 - Allis-Chalmers Energy Inc. and Bronco Drilling Co. Inc. mutually terminated their amended merger agreement, it was reported in a form 8-K filed Friday with the Securities and Exchange Commission.

It was unlikely that the agreement would be adopted by the required number of Bronco stockholders, the filing said.

Bronco agreed to pay Allis-Chalmers $4.5 million.

In January Allis-Chalmers agreed to acquire Bronco Drilling in a cash and stock deal valued at $437.8 million.

Stockholders of both companies were to vote on the agreement at separate meetings on Aug. 14.

As previously reported, Bronco shareholders' Third Avenue Management LLC, Wexford Capital LLC and Alpine Associates were opposed to the deal.

Houston-based Allis-Chalmers provides services and equipment to oil and natural gas exploration and development companies.

Bronco Drilling, located in Edmond, Okla., provides contract land drilling and workover services to oil and gas exploration companies.

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