OLD GREENWICH, Conn., Aug. 12, 2024 (GLOBE NEWSWIRE) — Star Equity Holdings, Inc. (Nasdaq: STRR; STRRP), a diversified holding company, announced today that effective August 9, 2024, it completed an investment in Enservco Corporation (NYSE American: ENSV), a Colorado-based Energy Services company that is expanding into the Transportation & Logistics sector via the acquisition of Buckshot Trucking, LLC.
Transaction Highlights
- Star issued 250,000 shares of its 10% Series A Cumulative Perpetual Preferred Stock (“STRRP”) to Enservco in exchange for 12.5 million ENSV common shares and share equivalents, representing $2.5 million in value using STRRP’s $10.00 per share liquidation preference.
- Star also made a $1 million short-term loan to Enservco in the form of a promissory note to facilitate the acquisition of Buckshot.
- Star will receive one seat on Enservco’s Board of Directors, which has been designated for Star’s CEO, Rick Coleman.
Enservco provides specialized well-site services to the domestic onshore oil and gas industry. Its current operating segments, Hot Oiling & Acidizing and Frac Water Heating, support drilling, completion, production, and maintenance activities spanning the life of oil and gas wells. Of note, as recently announced, Enservco is implementing a strategic repositioning of its operations via the partial sale of its Frac Water Heating business, and by entering the Transportation & Logistics sector via the acquisition of Buckshot.
Jeff Eberwein, Executive Chairman of Star, commented, “We are excited to partner with Enservco on this investment, which advances Star’s expansion strategy by further diversifying its portfolio beyond Building Solutions, marking our initial entry into the Energy Services and Transportation & Logistics sectors. We believe the strength of Enservco’s management team and its ongoing reorganization position it well for long-term growth. We look forward to participating in Enservco’s future success and believe this investment will be highly accretive to our shareholders.”
Additional Transaction Details
- Star’s short-term loan to Enservco has a 20% annualized interest rate and is collateralized by the STRRP shares issued to ENSV.
- At close, Star acquired approximately 20% of ENSV common shares and additional preferred shares convertible into ENSV common stock.
- All ENSV securities acquired in this transaction will be held in Star’s Investments division.
About Enservco Corporation
Based in Longmont, CO, with field locations in major oil and gas basins throughout the U.S., Enservco serves more than 300 E&P customers, including majors, mid-tier, and small independent operators. With one of the industry’s largest, most modern equipment fleets, the Company provides an array of complementary oilfield services that help customers increase efficiencies and maximize production. Through the recent acquisition of Buckshot Trucking, LLC, Enservco has pivoted into Logistics, a less-seasonal, higher-margin business with multiple opportunities for organic and inorganic growth.
For more information, visit http://enservco.com/.
About Star Equity Holdings, Inc.
Star Equity Holdings, Inc. is a diversified holding company currently composed of two divisions: Building Solutions and Investments.
Building Solutions
Our Building Solutions division operates in three businesses: (i) modular building manufacturing; (ii) structural wall panel and wood foundation manufacturing, including building supply distribution operations; and (iii) glue-laminated timber (glulam) column, beam, and truss manufacturing.
Investments
Our Investments division manages and finances the Company’s real estate assets as well as its investment positions in private and public companies.
