Atlas Energy Solutions to Acquire Hi-Crush for $450 Million
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Atlas Energy Solutions (AESI) has entered into a definitive agreement with Hi Crush to acquire all of Hi-Crush’s Permian Basin proppant production assets and North American logistics operations in a transaction valued at $450 million.
The transaction consideration includes $150 million in up-front cash, $175 million in shares of common stock of AESI and $125 million in deferred cash payments in the form of a seller’s note. Both the up-front cash consideration and the principal amount of the seller’s note are subject to revision for customary post-closing adjustments.
“This is a great day for Atlas and Hi-Crush, we are thrilled to bring these two great organizations together. Both companies have led the industry’s innovations to drive efficiencies in proppant and logistics in different but complementary ways, a testament to the high quality people involved. Combining the teams, their technologies and best practices, as well as their complementary geographical footprint, should compound constructively to the benefit of our shareholders,” said Bud Brigham, executive chairman and CEO of Atlas.
“It also furthers our goal to lead the industry in transitioning the Permian, already the premier producing region in the country, to becoming the most efficient and livable energy manufacturing center in the world,” added Brigham.
“Over the years both Atlas and Hi-Crush have invested significant capital in their proppant and logistics businesses to drive efficiency gains for our customers at the well site — Atlas with its Dune Express, high efficiency trucking operations, and autonomous trucking and Hi-Crush with its OnCore distributed mining network and Pronghorn logistics platform,” said John Turner, president and CFO of Atlas.
“These investments have supported a consolidating industry that has quickly scaled. We look forward to continuing to invest to drive innovation and efficiencies at the well site,” added Turner.
“I’m so proud of all that our team has accomplished over the past several years. I thank our employees for their relentless effort restoring Hi-Crush to a leadership position in our industry and thank our partners at Clearlake Capital Group and Whitebox Advisors for their support,” said Dirk Hallen, CEO of Hi-Crush.
“I echo Bud and John’s excitement in uniting two of the most innovative players in frac sand under Atlas. There is no doubt that this winning combination will be transformative for our industry, employees, customers, and shareholders,” added Hallen.
“This transaction represents an important milestone for Hi-Crush after going through a strategic transformation over the past several years in partnership with Dirk and the broader team. The leadership has driven innovation and growth, as well as transformed the operational footprint of the business to address the evolving needs of our customers. Atlas’ investment reflects their conviction in the strategy, and we look forward to all that we will accomplish together,” said Colin Leonard, Hi-Crush board chairman and partner at Clearlake Capital Group.
Atlas Energy Solutions is a leader in the proppant and proppant logistics industry and is currently solely focused on serving customers in the Permian Basin of West Texas and New Mexico, the most active oil and natural gas producing regions in North America. Its Kermit, Texas and Monahans, Texas facilities are strategically located and specifically designed to maximize reliability of supply and product quality, and their deployment of trucking assets and the Dune Express is expected to drive significant logistics efficiencies.
Hi-Crush, together with its subsidiaries, is a fully-integrated provider of proppant and logistics services for hydraulic fracturing operations, offering frac sand production, advanced wellsite storage systems, flexible last mile services, and innovative software for real-time visibility and management across the entire supply chain. Hi-Crush’s strategic suite of solutions provides U.S. oil and gas operators and service companies with the ability to build safety, reliability, and efficiency into every completion.
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