Ranger Energy Services Announces Agreement to Acquire American Well Services

Core Viewpoint - Ranger Energy Services has acquired American Well Services, positioning itself as the largest well-services provider in the United States and enhancing its market reach and technological capabilities [1][3]. Strategic Highlights - The acquisition expands Ranger's rig count by approximately 25%, solidifying its leadership in the Lower 48 states [4]. - The total consideration for the acquisition is approximately $90.5 million, representing less than 2.5 times trailing EBITDA [4][10]. - Expected synergies from the acquisition are projected to generate $4 million annually, with pro forma EBITDA anticipated to exceed $100 million [6][11]. Financial Considerations - The transaction is structured as $60 million in cash, 2 million shares of Ranger common stock priced at $12.51, and a $5 million earn-out contingent on achieving $36 million in EBITDA within 12 months [5]. - Post-acquisition, Ranger's leverage ratio is expected to be approximately 0.4x, indicating a strong financial position compared to peers [5][13]. Growth Opportunities - The acquisition introduces higher-margin service lines such as tubing rentals and inspection, enhancing revenue potential [9]. - Ranger's expanded platform will facilitate investment in innovative technologies, including the ECHO hybrid electric rig program [9]. Shareholder Returns - Ranger is committed to maintaining its capital allocation strategy, which includes repurchasing shares and ensuring strong shareholder returns post-transaction [12]. Financial Flexibility - The company expects to repay acquisition-related borrowings within one year, supported by strong free cash flows [13].