FORT WORTH, Texas–(BUSINESS WIRE)–FTS International, Inc. (NYSE American: FTSI) today announced that it has entered into a definitive agreement to be acquired by ProFrac Holdings, LLC, a leading oilfield services company, in an all-cash transaction that values FTSI at approximately $407.5 million, including payments to outstanding warrants. The Company also reported its preliminary Q3 2021 quarterly results.
Under the terms of the agreement, which has been unanimously approved by FTSI’s Board of Directors (the “Board”), FTSI stockholders will receive $26.52 per share of FTSI common stock in cash. This represents approximately a 14% premium over the Company’s 60-day volume-weighted average closing share price through October 21, 2021.
The transaction will create one of the largest completions focused service companies in the U.S. oil and gas industry. The combination of FTSI and ProFrac will bring together two strong and respected industry players to deliver greater efficiencies and expanded equipment capabilities that will enable the combined company to succeed in an ever-changing industry. Together, the companies will have improved through-cycle resiliency via enhanced expertise, technology and scale.
“The Board and executive leadership team have carefully evaluated a range of strategic alternatives focused on maximizing value and determined that this cash offer from ProFrac, which provides immediate and certain value at an attractive price, is in the best interest of all stockholders,” said Eugene Davis, Chairman of the Board of FTSI. “This transaction is the result of a thoughtful analysis of FTSI’s best long-term position for stockholders. At the same time, our Board recognizes industry dynamics remain fluid and believes that the 45-day ‘go-shop’ provides us the optimal structure to execute this transaction. I’m confident this combination will create a stronger organization to successfully compete in our rapidly evolving industry.”
Michael Doss, CEO of FTSI, added, “The combination of these two companies creates a leading completions focused company that will be in a better position to succeed through cycles, deliver the best level of service to our customers and retain the industry’s best talent.”
“We have long respected FTSI and the people that have guided them through the past few years to the position of strength they are in today,” said Ladd Wilks, CEO of ProFrac. “Together, these two organizations, which share an employee-centric vision and approach to operating in a dynamic industry, will create the scale needed to deliver the reliable, efficient and technology-led service our customers need.”
45-Day “Go-Shop”
The agreement includes a 45-day “go-shop” period expiring December 5, 2021. This allows the Board and its advisors to solicit alternative acquisition proposals from third parties. The Board will have the right to terminate the merger agreement with ProFrac to enter into a superior proposal, subject to the terms and conditions of the merger agreement. There can be no assurance that this “go-shop” will result in a superior proposal, and FTSI does not intend to disclose developments with respect to the solicitation process unless and until it determines such disclosure is appropriate or otherwise required.
Transaction Details
FTSI’s Board has unanimously approved the agreement with ProFrac and recommends that FTSI stockholders vote in favor of the transaction at the Special Meeting of Stockholders to be called in connection with the transaction.
The transaction with ProFrac is expected to close in the first quarter of 2022, subject to customary closing conditions, including approval by FTSI stockholders and receipt of regulatory approvals. The Company’s obligation to close the transaction is also conditioned upon approval by a majority of the Company’s stockholders, excluding its largest stockholder THRC Holdings, which is an affiliate of ProFrac. Upon closing of the transaction, the Company’s common stock will no longer be listed on any public market.
Advisors
Ducera Partners LLC is serving as financial advisor to FTSI and Davis Polk & Wardwell LLP is serving as its legal counsel. Piper Sandler & Co. is serving as financial advisor to ProFrac and Vinson & Elkins LLP is serving as its legal counsel.
About FTS International, Inc.
Headquartered in Fort Worth, Texas, FTS International is a pure-play hydraulic fracturing service company with operations across multiple basins in the United States.
To learn more, visit www.FTSI.com.
About ProFrac
ProFrac provides industry-leading solutions allowing our customers to harness critical natural resources. Since 2016, ProFrac has offered top of the line, high-pressure pumps paired with the toughest frac equipment crafted for longer-laterals and multi-well pads. ProFrac believes in environmental stewardship and continues to invest in technology and equipment to reduce our emissions.
