Exhibit 99.3
ALLIS-CHALMERS CORPORATION NEWS RELEASE
For Immediate Release CONTACT: Munawar H. Hidayatallah
Chief Executive Officer
Allis-Chalmers Corporation
310 407-5377
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ALLIS-CHALMERS CORPORATION ACQUIRED
BY NATURAL GAS DRILLING SERVICE COMPANY
Brookfield, Wisconsin - May 10, 2001 - Allis-Chalmers Corporation (Nasdaq OTC:
ACLM), announced that on May 9, 2001 it completed a transaction pursuant to
which its wholly-owned subsidiary merged into OilQuip Rentals, Inc. In
connection with the merger, Allis-Chalmers agreed to issue 10,000,000 shares of
its common stock to the former OilQuip shareholders, which upon issuance will
constitute approximately 86% of its outstanding stock, and appointed Munawar H.
Hidayatallah, the Chief Executive Officer and controlling shareholder of
OilQuip, as the new President, Chief Executive Officer and Chairman of the Board
of Directors of Allis-Chalmers.
Pursuant to the merger, Allis-Chalmers issued 400,000 shares of its
common stock to the former OilQuip shareholders and agreed to issue an
additional 9,600,000 shares to such shareholders upon the amendment of its
charter to authorize the issuance of such shares. Holders of approximately 70%
of Allis-Chalmers common stock have granted proxies to Mr. Hidayatallah in favor
of approving such amendment, which is expected to be approved at a meeting of
shareholders to be held in June or July 2001. As a result of the merger,
Allis-Chalmers was relieved of a liability to the Pension Benefit Guaranty
Corporation in the amount of approximately $66.7 million. The merger transaction
will be accounted for as a reverse acquisition under the purchase method of
accounting.
OilQuip, through its subsidiary Mountain Compressed Air, Inc., provides
air drilling services for the exploration and production of natural gas in the
United States. Prior to the merger, Allis-Chalmers operated one active
subsidiary, Houston Dynamic Service, Inc., an equipment repair and remanufacture
facility located in Houston, Texas. Allis-Chalmers intends to investigate
acquisition opportunities in the natural gas exploration and drilling industry
and intends to use Houston Dynamic Service as a centralized fabrication and
machining facility for its operations.
Mountain Compressed Air, Inc. has outstanding warrants to purchase an
aggregate of approximately 20% of its outstanding shares, including a warrant
issued to Wells Fargo Energy Capital entitling the holder to acquire 13.5% of
its outstanding shares.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995:
This release may contain forward-looking statements based on
Allis-Chalmer's current expectations, estimates and projections about it's
industry, management's beliefs, and certain assumptions made by us. Words such
as "anticipates," "expects," "intends," "plans," "believes," "seeks,"
"estimates," "may," "will" and variations of these words or similar expressions
are intended to identify forward-looking statements. In addition, any statements
that refer to expectations, projections or other characterizations of future
events or circumstances, including any underlying assumptions, are
forward-looking statements. These statements are not guarantees of future
performance and are subject to certain risks, uncertainties and assumptions that
are difficult to predict. Specifically, there can be no assurance that any
acquisition opportunities investigated by the company will lead to consummated
transactions.
Allis-Chalmer's Annual Report on Form 10-K for the year ended December
31, 2000 discusses some of the important risk factors that may affect the
pre-merger business, results of operations and financial condition of
Allis-Chalmers. We undertake no obligation to revise or update publicly any
forward-looking statements for any reason.