PITTSBURGH -- Heckmann Corp. (NYSE: HEK) on Sept. 4 announced that it has entered into a merger agreement with Mark Johnsrud, founder and owner of Badlands Energy LLC, a North Dakota limited liability company doing business as Power Fuels.
Power Fuels is a privately held North Dakota-based environmental services provider focused on the transportation, treatment, recycling and disposal of fluids. It is the largest environmental services company in the Bakken shale.
The merger is expected to be highly accretive to Heckmann’s earnings per share and is expected to close in the fourth quarter of 2012. The completion of the merger is subject to customary regulatory approvals.
Through June 30, Power Fuels generated trailing 12-month revenues of approximately $363.5 million and trailing 12-month adjusted EBITDA of approximately $154.7 million. Under terms of the agreement, Heckmann plans to pay $125.0 million in cash and 95 million shares of the company’s common stock, subject to, among other things, a two-year lockup agreement and a two-year standstill agreement.
Heckmann will also assume/refinance approximately $150 million of Power Fuels’ debt.
According to a Heckmann news release, the transaction significantly expands the company’s total environmental solutions operations. The business combination is expected to double Heckmann’s annual revenue, extend its geographic reach and broaden its customer base.
The combined company will continue to expand its environmental service offering by leveraging the respective strengths of each organization, including the recently acquired Thermo Fluids Inc. with its environmental recycling expertise.
“Just three years ago, in the summer of 2009, we set out to build the largest environmental services company in the United States, operating in a completely new market segment. We are well down that path, and $1 billion in revenue is within our reach,” said Richard J. Heckmann, chairman and chief executive of Heckmann Corp. “Producers in the U.S. shale basins are extremely focused on environmental solutions and looking for what we offer – a large nationwide company with dedicated services to handle their environmental needs. Our multi-basin presence allows us to migrate and expand with our customers as they further develop their shale assets.”
Recommended Reading
NOV Announces $1B Repurchase Program, Ups Dividend
2024-04-26 - NOV expects to increase its quarterly cash dividend on its common stock by 50% to $0.075 per share from $0.05 per share.
Repsol to Drop Marcellus Rig in June
2024-04-26 - Spain’s Repsol plans to drop its Marcellus Shale rig in June and reduce capex in the play due to the current U.S. gas price environment, CEO Josu Jon Imaz told analysts during a quarterly webcast.
US Drillers Cut Most Oil Rigs in a Week Since November
2024-04-26 - The number of oil rigs fell by five to 506 this week, while gas rigs fell by one to 105, their lowest since December 2021.
CNX, Appalachia Peers Defer Completions as NatGas Prices Languish
2024-04-25 - Henry Hub blues: CNX Resources and other Appalachia producers are slashing production and deferring well completions as natural gas spot prices hover near record lows.
Chevron’s Tengiz Oil Field Operations Start Up in Kazakhstan
2024-04-25 - The final phase of Chevron’s project will produce about 260,000 bbl/d.