Archrock, Inc. (NYSE: AROC) has announced the completion of its acquisition of Total Operations and Production Services, LLC (TOPS). This move is expected to bring significant changes to the company's operations and financials.
The acquisition has added 580,000 horsepower to Archrock's portfolio, including approximately 500,000 operating horsepower and a substantial and contracted backlog of new equipment. The company issued approximately 6.87 million new Archrock common shares to the sellers at closing, and funded the $826 million cash portion of the purchase price with a portion of the proceeds from its recently completed capital markets transactions.
Brad Childers, President and CEO of Archrock, expressed excitement about the transaction, highlighting the addition of a young fleet that deepens Archrock’s compression operations in the Permian Basin and establishes the company's leadership position in electric motor drive compression.
Following the acquisition, the company is confident in its ability to capitalize on the attractive opportunities presented by the robust market for natural gas and compression, while increasing returns to shareholders. Archrock's high-quality contracted fleet, technical expertise, and industry-leading balance sheet position the company to expand its exceptional service to new and existing customers.
This acquisition is expected to bring about a significant change in Archrock's financial metrics and operational capabilities, setting the stage for potential growth and enhanced shareholder value as the company navigates the dynamic natural gas and compression market. The market has reacted to these announcements by moving the company's shares 1.2% to a price of $20.23. For the full picture, make sure to review Archrock's 8-K report.
