Spark Energy, Inc. (SPKE), a Delaware corporation (“Spark”), today announced today that Spark and an affiliate of its founder and majority shareholder have entered into a purchase and sale agreement for the acquisition of Oasis Energy, a retail energy company with approximately 40,000 natural gas and electricity customers in six states. Oasis serves these customers across 19 utilities, several of which are new to Spark and provide additional organic growth opportunities for the Company. The purchase price is $20.0 million, subject to working capital adjustments. As part of the transaction, the Company will issue $5.0 million of its 5% convertible subordinated notes with a term of five years to the seller. The convertible subordinated notes are convertible into shares of Class B common stock at a conversion price of $14.00 following an 18-month holding period.
A special committee of the Board of Directors, consisting solely of independent directors, has approved this transaction. The closing of the transaction is subject to various approvals and conditions, including renegotiation of the Company’s senior credit facility. This acquisition is part of Spark’s strategy to accelerate the growth of its customer base through acquisition with the help of our founder. Management believes that the acquisition will immediately be accretive to the Company’s Adjusted EBITDA and will further secure the Company’s dividend.
Spark intends to operate the business as a standalone brand given its proven ability to realize strong gross margins through pricing and product mix.
“Our announcement today that we have entered into a purchase and sale agreement for the acquisition of Oasis Energy is an excellent example of our commitment to grow our business,” said Nathan Kroeker, Spark Energy, Inc.’s President and Chief Executive Officer. “This transaction is different than our previous transactions, where we purchased strictly customer books. In this transaction, in addition to purchasing a strong customer portfolio, we are also receiving the benefit of a solid brand, established vendor relationships, and the ability to grow in several new markets as we expand our footprint.”
Conference Call and Webcast
Spark will host a conference call to discuss first quarter 2015 results on Thursday, May 14, 2015 at 10:00 AM Central Time (11:00 AM Eastern).
A live webcast of the conference call can be accessed from the Events & Presentations page of the Spark Energy Investor Relations website at http://ir.sparkenergy.com/events.cfm. An archived replay of the webcast will be available for twelve months following the live presentation.
About Spark Energy, Inc.
Spark Energy, Inc. is an established and growing independent retail energy services company founded in 1999 that provides residential and commercial customers in competitive markets across the United States with an alternative choice for their natural gas and electricity. Headquartered in Houston, Texas, Spark currently operates in 16 states and serves 46 utility territories. Spark offers its customers a variety of product and service choices, including stable and predictable energy costs and green product alternatives.