Select Energy Services to merge with Rockwater Energy Solutions
Select Energy Services has signed a merger agreement with Rockwater Energy Solutions to form a new company with potential consolidation benefits in a range of $15m-$20m on an annualised basis expected next year.
Under the agreement, Select will offer 37.95 million shares of common stock, while Rockwater will issue all outstanding shares of common stock.
Once the transaction is completed, Select shareholders will hold around 64.4% of the combined entity, with Rockwater shareholders owning the remaining 35.6%.
Select Energy Services chairman and CEO John Schmitz said: “This is a very exciting opportunity to combine two companies that are highly focused on the challenge of providing world-class water-related services to the major shale basins.”
Post merger, the combined company aims to leverage party strengths across pre-frac and other water-related service lines, as well as the addition of completion and production chemicals business.
Rockwater provides water management solutions to the North American unconventional oil and gas industry, with a suite of chemical products and expertise related to water solutions.
Its solutions include water sourcing, transfer, treatment and storage; flowback and well testing; fluids conditioning and recycling, and field fluids logistics.
In addition, the company develops and manufactures speciality chemicals that find application in the well completion process, and production chemicals which allow oil and gas companies to improve well performance.
In the wake of the impending merger, Select secured a five-year financing of asset backed revolving loan (ABL) facility worth $150m from one of its lenders.
The company provides water sourcing for use in the drilling and completion activities in connection with hydraulic fracturing, in addition to water-related services for oil and gas well completion and production activities.