IPO Preview: Smart Sand

Summary

Smart Sand (Pending:SND) is expected to IPO on Friday, Nov. 4. The company expects to raise approximately $138.6 million through its sale of 10.6 million shares. Of those 10.6 million shares (subscription required), 1.5 million will be sold by company insiders (approximately 14% of the total). Shares are estimated to be sold at a price range of $15 to $18. Assuming shares are priced at the midpoint of the range, SND would command a fully-diluted market value of $522 million. The company plans to list its shares under the symbol SND.

The company intends to use a portion of the net proceeds from its IPO to repay its outstanding debt under its existing revolving credit facility and to redeem all of its outstanding preferred stock. The company plans to utilize the remaining net proceeds for general corporate uses.

Underwriters for the IPO include Credit Suisse and Goldman Sachs, Jefferies, Simmons & Co., Tudor, Pickering, Holt & Co., and Deutsche Bank.

Company Summary

Source: smartsand.com/products.html

Smart Sand Partners is an MLP, which was formed by Clearlake Capital in 2014 for the purpose of owning its own frac sand production assets in Wisconsin. Smart Sand is a low-cost producer of Northern White raw frac sand - a preferred proppant used to amplify hydrocarbon recovery rates during the hydraulic fracturing process of natural gas and oil wells. The company sells its products mainly to natural gas and oil production and exploration companies, including EOG Resources (NYSE:EOG), and oilfield service companies, including Weatherford (NYSE:WFT).

As of June 30, 2016, the company owned and operated a raw frac sand processing facility and mine near Oakdale, Wisconsin. The facility has an estimated 92 million tons of likely recoverable reserves and 244 million tons of confirmed recoverable reserves at the mine.

In addition to its Oakdale facility, the company also owns a property in Jackson County, Wisconsin, which is near a Class I rail line. Smart Sand has permission to initiate operations and develop there in the future.

1 2 3
View single page >> |

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

more

How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.