Ranger Energy Services has agreed to acquire STEP Energy Services’ U.S. coiled tubing assets for approximately $27.5 million, a transaction expected to make Ranger the second-largest onshore coiled tubing operator in the Lower 48.
The deal includes 13 complete coiled tubing spreads, related equipment and inventory and certain property and vehicle lease obligations.
Ranger also expects to hire approximately 220 STEP coiled tubing professionals and support employees when the transaction closes.
STEP’s U.S. business operates from five facilities across Ranger’s existing footprint, extending from the Bakken through South Texas with its largest concentration in the Permian Basin.
The assets include STEP’s COIL+ Extended Reach technology and capabilities targeting deep-capacity U.S. wells.
Ranger expects the acquired business to generate approximately $80 million to $90 million of revenue and more than $10 million of EBITDA in 2027.
That EBITDA estimate includes at least $2.5 million of anticipated first-year cost synergies.
At approximately $27.5 million of consideration, the purchase price represents slightly more than 2.5 times anticipated 2027 EBITDA. Ranger expects the acquisition to be accretive to earnings and EBITDA in 2027.
The purchase price consists of $22.5 million of cash and $5 million of Ranger equity.
Ranger expects to fund the asset purchase through revolver borrowings, with post-closing borrowings projected at approximately $30 million.
The transaction follows Ranger’s ECHO rig fleet expansion and acquisition of American Well Services and creates additional opportunities to connect coiled tubing services with its high-specification rig business.
Closing is expected around September 11, subject to customary conditions and required third-party consents.
KEY QUOTE:
“Going forward, Ranger will be a formidable coiled tubing provider with meaningful share in basins where we already have a deep presence, creating incremental value and opportunity for our professionals and stakeholders.”
Stuart Bodden, CEO Of Ranger Energy Services
