Cactus To Buy FlexSteel For Initial $621 Mln

(RTTNews) - Cactus, Inc. (WHD), a wellhead and pressure control equipment provider, said on Tuesday it inked a definitive deal to buy FlexSteel Technologies Holdings, Inc. and its affiliates by merging with its holding company, HighRidge Resources, Inc. and Atlas Merger Sub, LLC, a newly formed unit of Cactus, for an upfront consideration of around $621 million, on a cash-free, debt-free basis.

In addition, Cactus will pay a potential future earn-out payment of up to $75 million in mid-2024, if certain revenue growth targets are met by FlexSteel.

The closing of the transaction is expected in early 2023.

Cactus has received a bridge financing to fund the upfront payment together with cash on hand. It intends to finance the acquisition through a mix of cash, debt, or equity.

Scott Bender, CEO of Cactus, said: "This acquisition enhances Cactus' position as a premier manufacturer of specialized technologies delivered directly to our industry's end-users. FlexSteel's products combine the durability and reliability of steel with the speed and efficiency of spoolables… FlexSteel's products are also highly complementary to Cactus' equipment at the wellsite."

FlexSteel has posted revenue of around $265 million for the nine months to September 30, 2022.