Unimin to buy shale sand supplier Fairmount in cash-and-stock
deal
- Reuters News
12-Dec-2017 09:19:33 AM
HOUSTON, Dec 12 (Reuters) - Fairmount Santrol Holdings Inc
FMSA.Nsaid on Tuesday it would sell itself to Unimin Corp in a
cash-and-stock deal to create one of the largest suppliers of sand
for use in hydraulic fracturing to shale oil and gas producers.
The deal, which is expected to close by the middle of next year,
will create a company with about $2 billion in annual revenue and
will supply more than 45 million tons of sand annually. The new
company will also supply industrial coatings.
Sand, known as proppant in the oil industry, is used as part of
the fracking process to hold open tiny cracks in shale rock in
order to allow hydrocarbon molecules to escape. Oil companies
typically shop for various shapes and sizes of sand to suit their
geology. That has made the sand industry appealing to investors in
recent years.
"Together we will serve our customers more efficiently and
effectively with a broader and more diverse product offering,
greater technical expertise, improved scale and geographic
diversity and an expanded logistics platform," Fairmount Chief
Executive Jenniffer Deckard said in a statement.
Deckard is expected to be CEO of the new company, which has not
yet been named.
Fairmount shareholders will receive $170 million in cash and own
about 35 percent of the new company after the deal closes. Unimin,
a division of Belgium-based SCR-Sibelco NV, will own the rest.
Shares of Fairmount rose 4.6 percent to $5.27 after the deal was
announced.
Unimin received financing from Barclays Bank
BARC.Land
BNP Paribas for the deal.
(Reporting by Ernest Scheyder; Editing by Susan Thomas)
FMSA
Posted by mla127 on 11th of Dec 2017 at 12:07 pm
FMSA
Unimin to buy shale sand
Posted by pinguin on 12th of Dec 2017 at 10:27 am
Unimin to buy shale sand supplier Fairmount in cash-and-stock deal - Reuters News
12-Dec-2017 09:19:33 AM
HOUSTON, Dec 12 (Reuters) - Fairmount Santrol Holdings Inc FMSA.Nsaid on Tuesday it would sell itself to Unimin Corp in a cash-and-stock deal to create one of the largest suppliers of sand for use in hydraulic fracturing to shale oil and gas producers.
The deal, which is expected to close by the middle of next year, will create a company with about $2 billion in annual revenue and will supply more than 45 million tons of sand annually. The new company will also supply industrial coatings.
Sand, known as proppant in the oil industry, is used as part of the fracking process to hold open tiny cracks in shale rock in order to allow hydrocarbon molecules to escape. Oil companies typically shop for various shapes and sizes of sand to suit their geology. That has made the sand industry appealing to investors in recent years.
"Together we will serve our customers more efficiently and effectively with a broader and more diverse product offering, greater technical expertise, improved scale and geographic diversity and an expanded logistics platform," Fairmount Chief Executive Jenniffer Deckard said in a statement.
Deckard is expected to be CEO of the new company, which has not yet been named.
Fairmount shareholders will receive $170 million in cash and own about 35 percent of the new company after the deal closes. Unimin, a division of Belgium-based SCR-Sibelco NV, will own the rest.
Shares of Fairmount rose 4.6 percent to $5.27 after the deal was announced.
Unimin received financing from Barclays Bank BARC.Land BNP Paribas for the deal.
(Reporting by Ernest Scheyder; Editing by Susan Thomas)
(( ernest.scheyder@thomsonreuters.com; Twitter: https://twitter.com/ErnestScheyder; +1-713-210-8512; Reuters Messaging: ernest.scheyder.thomsonreuters.com@reuters.net))
Keywords: FAIRMOUNT-M&A/SIBELCO