Natural Gas Services Group Buys Flatrock for $120 Million, Boosts Credit Line to $500 Million
NGS•Natural Gas Services Group is acquiring Flatrock Compression for $120 million ($110 million cash, $10 million stock), adding an 86,000-horsepower rental fleet in the Permian Basin and Eagle Ford. The deal, at a 6.2x EBITDA multiple, is immediately accretive and follows a credit facility increase to $500 million.
1. Acquisition Terms
Natural Gas Services Group is acquiring Flatrock Compression Holdings for $120 million consideration, comprising $110 million cash and $10 million in newly issued stock. Flatrock’s fleet of about 86,000 horsepower is 95% utilized and includes large horsepower and electric motor driven units in the Permian Basin and Eagle Ford.
2. Financial Impact
The transaction is priced at an approximate 6.2x last quarter annualized Adjusted EBITDA multiple and is immediately accretive to key metrics. Natural Gas Services Group increased its revolving credit facility from $400 million to $500 million with a $100 million accordion feature, maintaining a pro forma leverage ratio of roughly 3x.
3. Strategic Rationale
The acquisition diversifies the customer base by adding several large clients and deepens the operational footprint in two major basins. Combined fleets and complementary horsepower mix drive scale efficiencies and enhance service capabilities, supporting long-term growth.
