ProFrac Holding to acquire REV Energy, Performance Holdings

ProFrac Holding reported that it has closed its previously-announced acquisition of the Eagle Ford sand mining operations of Monarch Silica and announced that it has entered into definitive agreements to acquire two companies that will grow its pressure pumping footprint and sand mine portfolio. The Company’s subsidiary, ProFrac Holdings II has entered into a definitive agreement to acquire REV Energy Holdings, a privately owned pressure pumping service provider with operations in the Rockies and Eagle Ford. Under the terms of the agreement, ProFrac will acquire REV for $140M, consisting of $70M in ProFrac Class B common shares, approximately $39M in seller-provided financing, and the balance with cash on hand and debt assumption of approximately $5.5M. The purchase agreement also provides for up to $20 million of earn-out payments in the event REV achieves EBITDA of approximately $90 million in 2023. The transaction is expected to close before the end of January 2023. ProFrac also announced that its subsidiary, ProFrac Holdings II, LLC, has entered into a definitive agreement with Performance Holdings I, LLC and Performance Holdings II to acquire the largest in-basin proppant producer serving the Haynesville, for $475 million of cash. ProFrac expects the transaction to be accretive to earnings and free cash flow immediately upon closing. Based on preliminary discussions with capital providers, including existing and potential new lenders, as well as the Company’s largest shareholders, ProFrac believes it will be positioned to fund the acquisition with a combination of new capital and cash from operations. Such preliminary discussions are non-binding, and the Company cannot assure that it will raise new capital from such discussions on a timely basis or otherwise. The Company expects the acquisition to close in the first quarter of 2023.