SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
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March 28, 1996
(Date of report)
KEY ENERGY GROUP, INC.
(Exact name of registrant as specified in its charter)
Maryland 1-8038 04-2648081
(State or other (Commission (I.R.S. employer
jurisdiction of file number) identification no.)
incorporation
or organization)
255 Livingston Avenue
New Brunswick, New Jersey 08901
(address of principal executive offices)
(908) 247-4822
(Registrant's telephone number,
including area code)
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Item 2. Acquisition or Disposition of Assets.
On March 28, 1996, Key Energy Group, Inc., a Maryland corporation
("Key"), completed its acquisition, in the form of a merger (the "Merger"), of
the assets and operations of WellTech, Inc., a Delaware corporation
("WellTech"). In the Merger, holders of shares of WellTech common stock, $1.00
par value per share ("WellTech Common Stock"), outstanding immediately prior to
the Merger received an aggregate of 4,929,962 shares of Key Common Stock and Key
Five-Year Warrants to purchase an aggregate of 750,000 shares of Key Common
Stock at $6.75 per share. As part of the Merger, 1,429,962 of the 1,635,000
shares of Key Common Stock owned by WellTech immediately prior to the Merger
(the "Existing Key Shares"), and the warrants to purchase an aggregate of
250,000 shares of Key Common Stock at $5.00 per share (the "Existing Key
Warrants") were cancelled. The remaining 205,038 shares of existing Key Common
Stock were distributed to directors of WellTech prior to the Merger. Based on
the 352,941 shares of WellTech Common Stock outstanding at the time of the
Merger, each share of WellTech Common Stock was converted into 13.9682 shares of
Key Common Stock and Key Five-Year Warrants to purchase 2.125 shares of Key
Common Stock.
The transaction was negotiated on an arms'-length basis between
representatives of Key and representatives of WellTech. In connection with the
acquisition, WellTech was granted the right to nominate two directors for
election to the board of directors of Key. W. Phillip Marcum and Kevin P.
Collins have been elected to serve on the board of directors of Key as
WellTech's nominees. As a result of the Merger, Key has expanded its operations
into Oklahoma, Michigan, Pennsylvania and West Virginia, and conducts the
following businesses formerly operated by WellTech: (i) workover rig services,
including completion of new wells maintenance and recompletion of existing walls
(including horizontal recompletions) and plugging and abandonment of wells at
the end of their useful lives; (ii) oil field liquid transportation, storage and
disposal services, including vacuum truck services, trac tank rental and salt
water injection; and (iii) other services including pipeline installation and
besting, slick line wireline services, fishing and rental tool services and
general oil field roustabout services. In addition to its domestic operations,
Key acquired WellTech's well servicing equipment and operations in Argentina.
Item 7. Financial Statements and Exhibits.
(a) Financial statements of businesses acquired.
Incorporated by reference to pages F-39 through F-64
of Key's Form S-4 Registration Statement No. 333-369.
(b) Pro forma financial information.
Incorporated by reference to pages F-65 through F-73
of Key's Form S-4 Registration Statement No. 333-369.
(c) Exhibits.
2.1 -- Agreement and Plan of Merger (the "Merger Agreement") dated as
of November 18, 1995, among Key and WellTech (incorporated by
reference to Exhibit 2.1 to Key's Form S-4 Registration Statement
No. 333-369).
2.2 -- Amendment No. 1 to the Merger Agreement (incorporated by reference
to Exhibit 2.1 to Key's Form S-4 Registration Statement No.
333-369).
2.3 -- Amendment No. 2 to the Merger Agreement (incorporated by reference
to Exhibit 2.1 to Key's Form
S-4 Registration No. 333-369).
23.2 -- Consent of Arthur Andersen LLP filed herewith as Exhibit 23.2.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
KEY ENERGY GROUP, INC.
Dated: March 28, 1996 By:/s/ Francis D. John
Francis D. John
President
Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Form 8-K of our report dated August 31, 1995 (except with
respect to the matters discussed in Note 12, as to which the date is January 19,
1996), on the WellTech, Inc. consolidated financial statements as of December
31, 1994 and 1993 and for the three years in the period ended December 31, 1994
included in Key Energy Group, Inc.'s Form S-4 registration statement
(Registration No. 333-369). It should be noted that we have not audited any
financial statements of WellTech, Inc. subsequent to December 31, 1994 or
performed any audit procedures subsequent to the date of our report.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Houston, Texas
March 26, 1996
