Flowco (FLOC) M&A announcement summary

Deal rationale and strategic fit

• Acquisition of a leading ESP provider expands the artificial lift solutions portfolio, enabling comprehensive well lifecycle optimization and production solutions.

• Expands addressable market by 70%, positioning to serve 85% of the U.S. Lower 48 onshore artificial lift market and addressing a $2.5 billion annual U.S. opportunity.

• Unlocks new revenue streams and cross-selling opportunities across combined customer bases and U.S. shale basins.

• Aligns with disciplined M&A and capital deployment strategies, focusing on high-performing teams and long-term growth.

• Strengthens position in key U.S. basins and supports international expansion potential.

Financial terms and conditions

• Total consideration of $200 million: $170 million in cash (from ABL facility) and $30 million in equity (approx. 1.5 million shares of Class A common stock).

• Equity portion based on 10-day volume-weighted average price as of January 30, 2026.

• Implied purchase price multiple of 3.9x estimated 2026 Adjusted EBITDA, excluding synergies.

• Transaction is cash-free, debt-free, and funded through modest borrowings; pro forma net leverage expected to remain below one turn.

• Expected to be accretive to earnings, free cash flow, and free cash flow per share.

Synergies and expected cost savings

• Revenue synergies anticipated through cross-selling and expanded market reach, especially in new basins and international markets.

• Enhanced service offering and operational efficiencies expected from integration of ESP and HPGL capabilities.

• Cost synergies are not the primary focus; integration aims to leverage complementary strengths.