Matlin & Partners and U.S. Well Services to Combine for a Total Enterprise Value of $588 Million
Matlin & Partners Acquisition Corp. (“MPAC”), announced this morning it has entered into a merger and contribution agreement with U.S. Well Services, LLC (“USWS”’), a technology-oriented oilfield service company focused exclusively on hydraulic fracturing services for the oil and gas industry. The transaction values USWS at 2.6x 2019 projected adjusted EBITDA, implying a discount of 32% to publicly traded peers.
Current cash held in trust is $327.2 million and MPAC is estimating cash at closing will be $329 with accrued interest. Read below for additional transaction details.
The conference call to discuss the proposed business combination is being held today, at 11:00 a.m. Eastern time Dial: (866) 610-1072 and refer to audience passcode 6498027.
A replay will be available until July 30th: dial (800) 585-8367 and reference audience passcode 6498027.
TRANSACTION DETAILS
CONSIDERATION
- Existing USWS equity owners receive rollover equity consideration equivalent to ~34% of the pro forma combined company
- Cash held in Trust – $329 million estimated at closing to repay USWS Term Loan and Revolving Credit Facility and fund fleet expansion
PIPE
- $135 million PIPE at $10.00 per share to fund fleet expansion. Led by Crestview Partners.
FOUNDERS SHARES
- The MPAC Sponsors will surrender for cancellation (and for no consideration) 2,000,000 of MPAC’s Founders Shares. As a reminder, the Sponsors currently hold a total of 8,125,000 Founders Shares.
SPONSOR PRIVATE PLACEMENT WARRANTS
- The MPAC Sponsors will also be surrendering for cancellation (and for no consideration) 1,870,968 Private Placement Warrants that were purchased for $0.50 at the time of the IPO. (MPAC Sponsors currently hold 14,500,000 warrants)
- Cantor currently hold 1,000,000 Sponsor warrants and will also be cancelling 129,032 of them.
ADVISORS
- MPAC was advised on the business combination by Cantor Fitzgerald & Co.
- Piper Jaffray & Co., through its Simmons & Company International division, acted as financial advisor.
- Bracewell LLP as legal counsel to MPAC.
- Winston & Strawn LLP acted as legal advisors to USWS.
- Vinson & Elkins L.L.P. acted as legal counsel to Crestview.
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