Natural Gas Services Group announced the acquisition of Flatrock Compression Holdings for $120 million, expanding its natural gas compression business and strengthening its presence across the Permian Basin and Eagle Ford regions.
The transaction consists of $110 million in cash and $10 million in newly issued Natural Gas Services Group common stock. Founded in 2001, Flatrock Compression provides rental compression services to oil and natural gas producers and midstream companies. The company operates a fleet of approximately 86,000 horsepower, with a significant concentration in large-horsepower and electric motor-driven compression units. Flatrock’s fleet is currently operating at approximately 95% utilization based on horsepower.
According to Natural Gas Services Group, the acquisition broadens its customer base, adds several new large customers, and increases operational density in two of the most active energy-producing regions in the United States. The transaction also expands the company’s portfolio of large-horsepower compression equipment and electric motor-driven solutions while enhancing service capabilities and operating efficiencies.
The company said the acquisition is immediately accretive to key financial metrics and values Flatrock at approximately 6.2 times first-quarter 2026 annualized adjusted EBITDA before expected synergies. Following the transaction, Natural Gas Services Group expects to maintain a prudent leverage profile of about three times.
In conjunction with the acquisition, the company amended its existing credit agreement, increasing its committed credit facility from $400 million to $500 million while maintaining an additional $100 million accordion feature that could expand total commitments to $600 million, subject to lender approval and collateral availability.
Natural Gas Services Group, headquartered in Southlake, Texas, provides natural gas and electric compression equipment, technology, and related services to the energy industry. The company rents, designs, installs, services, and maintains compression equipment for oil and gas production facilities and midstream infrastructure throughout major producing regions in the United States.
Flatrock Compression has served the oil and gas industry for more than two decades and also offers patented gas lift facility solutions designed to maximize production while reducing methane emissions and minimizing downtime.
Support: Advisors to the transaction included Intrepid Partners and Gibson, Dunn & Crutcher for Natural Gas Services Group, while Greenridge Advisors, CBurke Legal, and Nelson Mullins Riley & Scarborough advised Flatrock Compression.
KEY QUOTES:
“This acquisition represents an important strategic step for NGS. Flatrock has built a high-quality compression business with a strong reputation for field execution, operational excellence, and customer service. The company has assembled an attractive compression fleet, which has grown organically at comparable rates to NGS.
This acquisition increases our operational density in both the Permian Basin and Eagle Ford, adds meaningful customer diversification and attractive opportunities for growth with several new large customers, and complements our fleet with the addition of significant large horsepower and electric motor units. Just as importantly, Flatrock’s culture aligns closely with ours, as both organizations are committed to safety, operational excellence, and delivering innovative and reliable compression solutions to customers. This is not only a strategic transaction, but also a highly attractive financial acquisition as the purchase price represents an approximate 6.2x Adjusted EBITDA multiple and it is immediately accretive to key financial metrics.
I would like to welcome all the employees of Flatrock to NGS, together, we will continue to grow faster than our competitors and lead the industry in technology and innovation. I would also like to thank all the employees of NGS for their hard work and dedication as well as our lending partners, both existing and new, who helped facilitate this transaction.”
Justin Jacobs, Chief Executive Officer of Natural Gas Services Group
“We are proud of the business our team has built and the reputation we have earned with our customers over many years. Our success has been driven by great people, operational discipline, technical expertise, and a relentless focus on customer service. After evaluating the opportunities available to our company, we believe NGS is the right partner to build upon that foundation. The combined organization will have greater scale, expanded capabilities, and additional growth opportunities for both our employees and customers. We are excited to join the NGS team and help drive the next phase of growth.”
B.J. Ellis, Chief Executive Officer of Flatrock Compression
