ProPetro Announces Acquisition Of Pumping Services Assets From Pioneer Natural

(RTTNews) - ProPetro Holding Corp. (PUMP) said that it reached an agreement with affiliates of Pioneer Natural Resources Co. (PXD) by which ProPetro will become a strategic long-term service provider to Pioneer providing pressure pumping and related services for a term of up to 10 years.

As per the agreement, ProPetro will acquire Pioneer's pressure pumping assets ("PPS") in exchange for total consideration of $400 million comprised of $110 million of cash and 16.6 million shares of ProPetro common stock, representing approximately 17% Pioneer ownership in ProPetro following issuance.

The transaction is expected to close during the fourth quarter of 2018, subject to the satisfaction of customary closing conditions, including regulatory approval.

The total transaction value of $400 million is comprised of $333 million for the pressure pumping assets and $67 million for real estate facilities and other assets. The total transaction will be funded through a combination of $290 million of ProPetro shares issued to Pioneer and $110 million in cash.

The 16.6 million shares issued by ProPetro are valued at $17.48 per share. ProPetro will pay $55 million of the cash portion of the purchase price to Pioneer at closing, with the balance to be paid within the following sixty days.

ProPetro said it plans to use a combination of its current revolving credit facility and its current cash balance to fund the cash portion.