Nine Energy Service Inc, an oilfield services company, has sold its production solutions segment to Brigade Energy Services LLC for about $17 million in cash. The deal closed on August 30, 2019. Brigade is a portfolio company of Turnbridge Capital.
HOUSTON–(BUSINESS WIRE)–Nine Energy Service, Inc. (“Nine” or the “Company”) (NYSE: NINE) today announced that it has sold its Production Solutions segment to Brigade Energy Services LLC (“Brigade”) for approximately $17 million in cash, subject to working capital adjustments. The transaction includes Nine’s fleet of 107 workover rigs, ancillary equipment and real estate associated with the 13 operating facilities throughout the United States. This divestiture will not impact Nine’s access to historic net operating losses. The transaction closed on August 30, 2019.
“We are pleased to announce the divestiture of our well services business to Brigade. Brigade’s sole focus on excellence in the well service space, coupled with the Brigade management team’s strong leadership capability, gives us comfort our team will be in good hands,” commented Nine’s President and Chief Executive Officer, Ann Fox. “This transaction makes Nine a pure-play, asset-light completions company with differentiated technology and service offerings. With the closing of the transaction, our employee base will decrease by approximately 24%, while simultaneously lowering capital expenditures. We expect this transaction to be accretive to net income, ROIC and Adjusted EBITDA margin going forward.”
Brigade’s Chief Executive Officer, Justin Bliffen, commented, “We are excited to acquire the exceptional people, robust fleet, and proud operational history of the Nine Production Solutions family of businesses. We look forward to working with Nine to ensure a smooth operational transition, with minimal disruption to our valued customers and employees. At Brigade, we are focused on driving service quality innovation and industry consolidation in the domestic well servicing market. We believe this transaction solidifies Brigade as the largest privately held well services provider in the U.S., enabling us to more rapidly scale up alongside our growing customer demand, while unlocking substantial synergies and economies of scale.”
Bruce Morgan, who had previously served as Nine’s President, Production Solutions will become President, Administration and Operations where he will report to David Crombie, Nine’s Chief Operating Officer and Executive Vice President. In his new role as President, Administration and Operations, Mr. Morgan will be providing input for business and strategic planning and aiding in the daily management of operations across Nine, as well as collaborating with corporate and operational teams to implement policies and develop improvements across the organization.
About Nine Energy Service
Nine Energy Service is an oilfield services company that offers completion solutions within North America and abroad. The Company brings years of experience with a deep commitment to serving clients with smarter, customized solutions and world-class resources that drive efficiencies. Serving the global oil and gas industry, Nine continues to differentiate itself through superior service quality, wellsite execution and cutting-edge technology. Nine is headquartered in Houston, Texas with operating facilities in the Permian, Eagle Ford, SCOOP/STACK, Niobrara, Barnett, Bakken, Marcellus, Utica and throughout Canada.
For more information on the Company, please visit Nine’s website at nineenergyservice.com.
About Brigade Energy Services
Brigade is an oilfield services company focused on providing completion, intervention, maintenance, and plugging and abandonment services to the growing population of extended-reach lateral, horizontal wellbores in the North American oil and gas industry. The company’s mission is to exceed customer expectations on every job by delivering experienced and innovative well service solutions, the highest quality equipment, and personnel steeped in a disciplined team culture. Brigade is committed to safety, integrity, process improvement, measurable performance, and operational excellence. Brigade is a portfolio company of Turnbridge Capital, an energy-focused private equity firm with offices in Dallas and Houston, Texas.
For more information on the company, please visit Brigade’s website at brigadeenergy.com.