Varco to Sell 30 Acres at $1 Million Loss

Moving one step closer to completion of a three-year-old plan to raise cash by selling unneeded real estate, Varco International Inc. said Tuesday it will sell 30 acres it owns in Oceanside back to the company it purchased the land from in 1981.

Although the Orange oil field equipment manufacturer paid between $5.5 million and $6 million for the parcel in 1981, it will resell the vacant space in the Rancho del Oro industrial park for $4.5 million--a loss of about $1 million, said Richard Kertson, Varco’s chief financial officer.

“It was for corporate expansion during the boom days,” Kertson said. “But we have no use for it now.”

The sale of the Oceanside property, he said, is the last major land sale by the company, which began shedding itself of real estate in 1982 after a slump in the oil tools industry began.

Varco, which sold its Orange headquarters site in September for $7.4 million, also has real estate for sale in Wyoming and Texas, which has a combined worth of about $1.5 million. Kertson said he doesn’t expect to sell the properties in the near future, however. “Those are very depressed areas, because they are oil field related,” he said.

Hard hit by the troubles that have beset the oil tools industry in the wake of declining petroleum production, Varco lost money for 13 consecutive quarters before posting a profit during the third quarter, which ended September 30.

As previously reported, Varco earned $202,000 during the quarter, compared with a loss of $2.9 million a year earlier. Revenues were $15.5 million, up slightly from third quarter 1984 revenues of $14.8 million.