Matlin & Partners Acquisition (MPAC) has reached a merger and contribution agreement with hydraulic fracturing services provider US Well Services (USWS) to create a publicly listed oilfield services company with an estimated total enterprise value of $588m.
The transaction is expected to create a firm with all-electric hydraulic fracturing capabilities leveraging USWS electric Clean Fleet technology.
The merger will also allow USWS to expand its fleet size to 17 spreads with 800,000 hydraulic horsepower.
Funds managed by Crestview Partners are set to make a $135m committed private investment in public equity (PIPE) investment in the combined entity for $10 a share.
The new investment will offer incremental equity capital to the new entity to fast-track the rollout of Clean Fleet technology, which combines natural gas turbine generators with electric motors and other equipment for hydraulic fracturing.
MPAC chairman and CEO David Matlin said: “This combination with USWS represents a significant opportunity in a provider of electric-powered hydraulic fracturing services with disruptive technology and significant growth potential.
“The capital being provided through this business combination will support USWS’ efforts to build on the advantages of its Clean Fleet technology to drive growth through increased fleet deployments, while strengthening the company’s balance sheet and positioning the company for long-term success.”
Once the business combination is completed, MPAC will be renamed US Well Services.
Through the transaction, the companies intend to capitalise on demand for innovative solutions as a result of increasing development of shale plays, as well as a shift to multi-well pads.
USWS CEO Joel Broussard said: “This transformational business combination enhances our capital position and will allow USWS to rapidly expand the number of fracturing spreads powered by Clean Fleet technology in operation to meet customer demand and drive growth.”
Subject to certain closing conditions, including regulatory approvals and shareholder approval, the transaction is scheduled to be closed in the fourth quarter of this year.
