Bristow Group Inc. and Era Group Inc. agreed on Jan. 23 to merge in an all-stock transaction expected to throw the Houston-based offshore helicopter companies a lifeline from slowing oil and gas activity. 

The two companies are leading providers of offshore oil and gas transportation, search and rescue (SAR) and aircraft support services to government and civil organizations worldwide. Combined, the companies expect to become more financially stronger with pro forma annual revenues of about $1.5 billion and at least $35 million in annual cost synergies.

The agreement follows remarks made by Era CEO Chris Bradshaw in a letter to shareholders last year that the offshore helicopter industry was in “dire need” of consolidation after several of the company’s peers entered bankruptcy.

“Those who follow the offshore helicopter business understand that the current industry structure is not sustainable, with multiple helicopter operators and leasing companies having already filed for bankruptcy protection and others expected to follow suit shortly,” Bradshaw wrote in the letter sent to shareholders in April 2019.

Once publicly traded, Bristow filed for Chapter 11 bankruptcy last year and emerged on Oct. 31 as a privately held company.

Bradshaw is set to become president and CEO of the combined company, which will remain headquartered in Houston.

Ducera Partners and Houlihan Lokey are financial advisers to Bristow, and Kirkland & Ellis LLP, Baker Botts LLP and Bracewell LLP are the company’s legal counsel. Centerview Partners LLC is exclusive financial adviser to Era, and Milbank LLP is its legal counsel.

Offshore