공시 • Dec 21
Kodiak Gas Services, Inc. (NYSE:KGS) executed a definitive merger agreement to acquire CSI Compressco LP (NasdaqGS:CCLP) from Spartan Energy Partners, LP, Merced Capital, L.P., Orvieto Fund, L.P., managed by Orvieto Partners, L.P. and Others for approximately $240 million.
Kodiak Gas Services, Inc. (NYSE:KGS) executed a definitive merger agreement to acquire CSI Compressco LP (NasdaqGS:CCLP) from Spartan Energy Partners, LP, Merced Capital, L.P., Orvieto Fund, L.P., managed by Orvieto Partners, L.P. and Others for approximately $240 million on December 19, 2023. Kodiak will acquire CSI Compressco in an all-equity transaction valued at approximately $854 million, including the assumption of $619 million of net debt. Under the terms of the merger agreement, CSI Compressco unitholders will receive 0.086 shares of Kodiak common stock for each CSI Compressco common unit owned. The combined company will have an "Up-C" structure at closing, and CSI Compressco unitholders meeting certain requirements will have the ability to elect to receive 0.086 limited liability company units representing economic interests in Kodiak's operating subsidiary (along with an equal number of shares of non-economic voting preferred stock of Kodiak) for each CSI Compressco common unit they hold. Each such unit will be redeemable at the option of the holder for one share of Kodiak common stock (along with cancellation of a corresponding share of preferred stock), following a six month post-closing lock-up and subject to certain conditions. Upon closing, CSI Compressco unitholders will own approximately 14% of the combined company on a fully diluted basis. Kodiak expects to launch a senior notes offering in the first quarter of 2024, the proceeds of which would ultimately be used to refinance CSI Compressco's debt at closing of the acquisition. Upon termination of the Merger Agreement under certain specified circumstances, including, among others, (a) termination by the CSI in order to enter into a definitive agreement with respect to a Superior Proposal, CSI would be required to pay Kodiak a termination fee equal to $15 million. Upon termination of the Merger Agreement under certain other specified circumstances, Kodiak would be required to pay the CSI a termination fee equal to $20 million.
The transaction is subject to certain regulatory approvals and other closing conditions, including Hart Scott Rodino Act clearance, the receipt of the required approvals from the CSI’s unitholders, the shares of Kodiak Common Stock issuable in connection with the Mergers having been approved for listing on the NYSE, subject to official notice of issuance, Kodiak’s registration statement on Form S-4 (the “Form S-4”) having been declared effective by the U.S. Securities and Exchange Commission, Kodiak obtaining debt financing through an offering of notes by Kodiak or its affiliates in order to refinance the Partnership’s outstanding debt, subject to certain minimum standards of terms and conditions that have been agreed to between the Partnership and Kodiak. The transaction has been approved by the Board of Directors of Kodiak and the Board of Directors of CSI Compressco GP LLC. Certain unitholders of CSI Compressco, including Spartan Energy Partners LP, which controls the CSI Compressco GP LLC, Merced Capital LP and Orvieto Fund that collectively own more than 50% of CSI Compressco's outstanding units have entered into support agreements, pursuant to which they have agreed to vote their CSI Compressco units in favor of the merger upon effectiveness of the S-4 Registration Statement with the SEC. The transaction is expected to close in the second quarter of 2024. The transaction is expected to be immediately accretive to Kodiak's Discretionary Cash Flow and Free Cash. Barclays acted as sole financial advisor to Kodiak and Keith M. Townsend and Robert J. Leclerc of King & Spalding LLP acted as legal counsels. Jefferies LLC acted as sole financial advisor to CSI Compressco and David Oelman, Lande Spottswood, Raleigh Wolfe, Ryan Carney, Allyson Seger, David D’Alessandro, Missy Spohn, Hill Wellford and Kara Kuritz, Evan Miller, Sean Becker; partner David Wicklund, Matt Dobbins, Rajesh Patel, David Johnson and Brian Howard of Vinson & Elkins LLP acted as legal counsels.