Archrock Lands Deal For Elite Compression
11 October 2019
Archrock has completed its US$410 million purchase of Elite Compression Services, a portfolio company of JDH Capital Co. The acquisition, which became official on Aug. 1, includes large-horsepower assets totaling 430,000 hp (320,651 kW).
Archrock paid for the transaction with US$205 million cash and 21.7 million new shares of Archrock stock issued to the seller. In a separate transaction, Harvest Midstream Co. acquired active and idle compression assets totaling 80,000 hp (59,656 kW) from Archrock for US$30 million.
“The assets being acquired from Elite are highly utilized, predominantly large-horsepower compression units, more than 80% of which are contracted for more than three years with blue-chip customers,” said Brad Childers, Archrock’s president and CEO. “This transaction adds basin density in our core areas, with more than 70% of the units deployed in the Eagle Ford and South Texas region.”
Archrock plans to rebrand Elite. Most of Elite’s employees have joined Archrock, while some from the executive management team will be with the company on a consulting arrangement, said Paul Burkhart, the company’s treasurer and vice president of investor relations.
“Everything will become Archrock,” Burkhart said.
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This story first appeared in the August/September 2019 issue of COMPRESSORTECH2. We only publish a fraction of our magazine content online, so for more great content, get every issue in your inbox/mailbox and access to our digital archives with a free subscription. Click here for a new subscription or here to renew your current subscription.