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Receives committed subscriptions for planned $32.5 million equity
rights offering
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Upsizes and extends first lien credit facility with $10 million
additional term loan
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Paid down $10 million of second lien term loan
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Nuverra Q3 operating activity and pricing remain strong
Nuverra Environmental Solutions, Inc. (NYSE American: NES) today
announced it has acquired Clearwater Solutions, a leading operator of
saltwater disposal wells (SWDs) in the Marcellus and Utica Shale areas,
for $41.9 million, subject to customary purchase price adjustments.
This purchase more than doubles Nuverra’s SWD capacity in the region and
will add value for each of its customers with more strategically located
disposal capacity. Clearwater’s disposal wells at the Clearwater Three
and Clearwater Five locations offer several offloading lanes and
disposal capacity of 17,500 barrels per day. Its locations are in
Guernsey County, Ohio, which is in the heart of the regional oil and gas
activity.
Charlie Thompson, Interim Chief Executive Officer said, “The Clearwater
acquisition significantly improves our competitive position in the
Northeast marketplace due to the added capacity of the new wells and
logistical advantages for our trucking business. Based on recent volume
statistics, Nuverra will be the second largest commercial operator of
SWDs in the region. Clearwater’s 2018 forecasted normalized EBITDA is
approximately $8 million before synergies. Synergies expected to be
realized through integration with our trucking operations would reduce
the post-synergy acquisition multiple to less than four times EBITDA.”
In connection with this transaction, Nuverra’s two largest shareholders
have provided financing of $32.5 million in the form of a bridge loan
that will be repaid with proceeds from a planned offering to
shareholders of common stock purchase rights. The rights offering will
be made available to all shareholders on a pro rata basis and bridge
loan lenders have committed to purchase the shares underlying any rights
that are not exercised by other holders. In addition, the Company
amended its first lien term loan to extend its maturity and received an
additional $10 million of term loan proceeds that funded a portion of
the Clearwater purchase price and made various other modifications to
give the Company additional flexibility.
Conference Call Scheduled for October 8, 2018 at 8:30 am EST
Nuverra executives will comment on the acquisition of Clearwater
Solutions during a live conference call, which is scheduled to begin at
8:30 am EST on Monday, October 8, 2018. Interested parties may
participate in the call by dialing 800-263-0877 and using passcode
1015683 . Please see the “Nuverra Acquires Clearwater” presentation on
our Investor Website at www.ir.nuverra.com
for additional details.
About Clearwater Solutions
Clearwater is a leading provider of safe, environmentally friendly
disposal of waste water used by the oil and gas industry in the
Marcellus and Utica Shale areas.
About Nuverra
Nuverra Environmental Solutions, Inc. is among the largest companies in
the United States dedicated to providing comprehensive, full-cycle
environmental solutions to customers in the energy market. Nuverra
focuses on the delivery, collection, treatment, and disposal of
restricted solids, water, wastewater, waste fluids, and hydrocarbons.
The Company provides its suite of environmentally compliant and
sustainable solutions to customers who demand stricter environmental
compliance and accountability from their service providers. Find
additional information about Nuverra in documents filed with the U.S.
Securities and Exchange Commission (“SEC”) at http://www.sec.gov.
Forward-Looking Statements Disclosure
This press release contains forward-looking statements within the
meaning of Section 27A of the United States Securities Act of 1933, as
amended, and Section 21E of the United States Securities Exchange Act of
1934, as amended. You can identify these and other forward-looking
statements by the use of words such as “anticipates,” “expects,”
“intends,” “plans,” “predicts,” “believes,” “seeks,” “estimates,” “may,”
“might,” “will,” “should,” “would,” “could,” “potential,” “future,”
“continue,” “ongoing,” “forecast,” “project,” “target” or similar
expressions, and variations or negatives of these words.
These statements relate to our expectations for future events and time
periods. All statements other than statements of historical fact are
statements that could be deemed to be forward-looking statements, and
any forward-looking statements contained herein are based on information
available to us as of the date of this press release and our current
expectations, forecasts and assumptions, and involve a number of risks
and uncertainties. Accordingly, forward-looking statements should not be
relied upon as representing our views as of any subsequent date. Future
performance cannot be ensured, and actual results may differ materially
from those in the forward-looking statements. Some factors that could
cause actual results to differ include, among others: the effects of our
completed restructuring on the Company and the interests of various
constituents; risks and uncertainties associated with the restructuring
process, including the outcome of a pending appeal of the order
confirming the plan of reorganization and our ability to execute the
requirements of the plan of reorganization subsequent to the effective
date; the loss of one or more of our larger customers; our ability to
attract and retain key executives and qualified employees in key areas
of our business; our ability to attract and retain a sufficient number
of qualified truck drivers in light of industry-wide driver shortages
and high-turnover; risks associated with our indebtedness, including
changes to interest rates, decreases in our borrowing availability, our
ability to manage our liquidity needs and to comply with covenants under
our credit facilities; the availability of less favorable credit and
payment terms due to changes in industry condition or our financial
condition, which could constrain our liquidity and reduce availability
under our revolving credit facility; difficulties in successfully
executing our growth initiatives, including identifying and completing
acquisitions and divestitures, and differences in the type and
availability of consideration or financing for such acquisitions and
divestitures; higher than forecasted capital expenditures to maintain
and repair our fleet of trucks, tanks, equipment and disposal wells;
control of costs and expenses; risks associated with the limited trading
volume of our common stock on the NYSE American Stock Exchange,
including potential fluctuations in the trading prices of our common
stock; risks associated with the reliance on third-party analyst and
expert market projections and data for the markets in which we operate;
risks associated with changes in industry practices and operational
technologies and the impact on our business; present and possible future
claims, litigation or enforcement actions or investigations; financial
results that may be volatile and may not reflect historical trends due
to, among other things, changes in commodity prices or general market
conditions, acquisition and disposition activities, fluctuations in
consumer trends, pricing pressures, transportation costs, changes in raw
material or labor prices or rates related to our business and changing
regulations or political developments in the markets in which we
operate; changes in customer drilling, completion and production
activities, operating methods and capital expenditure plans, including
impacts due to low oil and/or natural gas prices or the economic or
regulatory environment; risks associated with the operation,
construction, development and closure of saltwater disposal wells,
solids and liquids treatment and transportation assets, landfills and
pipelines, including access to additional locations and rights-of-way,
environmental remediation obligations, unscheduled delays or
inefficiencies and reductions in volume due to micro- and macro-economic
factors or the availability of less expensive alternatives; the effects
of competition in the markets in which we operate, including the adverse
impact of competitive product announcements or new entrants into our
markets and transfers of resources by competitors into our markets;
changes in economic conditions in the markets in which we operate or in
the world generally, including as a result of political uncertainty;
reduced demand for our services due to regulatory or other influences
related to extraction methods such as hydraulic fracturing, shifts in
production among shale areas in which we operate or into shale areas in
which we do not currently have operations; the impact of changes in laws
and regulation on waste management and disposal activities, including
those impacting the delivery, storage, collection, transportation,
treatment and disposal of waste products, as well as the use or reuse of
recycled or treated products or byproducts; risks involving developments
in environmental or other governmental laws and regulations in the
markets in which we operate and our ability to effectively respond to
those developments including laws and regulations relating to oil and
natural gas extraction businesses, particularly relating to water usage,
and the disposal, transportation and treatment of liquid and solid
wastes; and natural disasters, such as hurricanes, earthquakes and
floods, or acts of terrorism, or extreme weather conditions, that may
impact our business locations, assets, including wells or pipelines,
distribution channels, or which otherwise disrupt our or our customers’
operations or the markets we serve.
The forward-looking statements contained, or incorporated by reference,
herein are also subject generally to other risks and uncertainties that
are described from time to time in the Company’s filings with the SEC.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which reflect management’s views as of the
date of this press release. The Company undertakes no obligation to
update any such forward-looking statements, whether as a result of new
information, future events, changes in expectations or otherwise.
Additional risks and uncertainties are disclosed from time to time in
the Company’s filings with the SEC, including our Annual Reports on Form
10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K.
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