Archrock Expands its Compression Capacity With $357M NGCS Acquisition

Core Viewpoint - Archrock, Inc. has announced a definitive agreement to acquire Natural Gas Compression Systems for $357 million, enhancing its position in the natural gas compression services market in the U.S. [1] Group 1: Acquisition Details - The acquisition will be financed with$298 million in cash from Archrock's ABL credit facility and the issuance of up to 2.312 million new shares to the sellers [3] - The transaction has been unanimously approved by Archrock's board and is expected to close in the second quarter of 2025, pending regulatory approvals [3] Group 2: Strategic Benefits - The acquisition will increase Archrock's compression capacity to over 4.5 million operating horsepower, with a 10% increase in capacity in the Permian Basin, reaching approximately 2.5 million horsepower [4] - The merger will enhance Archrock's electric motor drive compression horsepower to approximately 815,000 [4] - The deal is anticipated to be immediately accretive to Archrock's earnings per share and dividend cash flow by the end of 2025 [4] Group 3: Company Overview - Archrock is a provider of natural gas contract compression services and aftermarket services for compression equipment, currently holding a Zacks Rank 1 (Strong Buy) [5]