Archrock (AROC) completed has closed its $357 million cash-and-stock acquisition of Natural Gas Compression Systems (NGCS), the company announced May 2.
NGCS’ compression business includes approximately 351,000 hp, including 316,000 operating horsepower and a 35,000 hp backlog of contracted new equipment. About 71% of its compression horsepower operates in the Permian Basin.
Under the terms of the deal, announced in March, Archrock funded the deal’s $299 million cash using its asset-based lending credit facility and issued approximately 2.251 million new shares to NGCS.
Archrock expects the acquisition to be immediately accretive to the company’s 2025 earnings and increase cash available for dividends for shareholders.
“This accretive transaction is expected to increase our scale, expand our customer relationships, deepen our operations in key regions and strengthen our position as a premier provider of natural gas compression services in the United States,” said Archrock CEO Brad Childers in the press release.
Houston-based Archrock is an energy infrastructure company that focuses on midstream natural gas compression for transport.