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ProFrac Holding Corp. Announces Its Intent to Maximize Value of Alpine Silica
Additional Investment Made by the Wilks Family WILLOW PARK, Texas, Oct. 2, 2023 /PRNewswire/ -- ProFrac Holding Corp. (NASDAQ: ACDC) ("ProFrac", or the
About this update from Profrac Holding Corp.
[{"type":"text","content":"Additional Investment Made by the Wilks Family\nWILLOW PARK, Texas, Oct. 2, 2023 /PRNewswire/ -- ProFrac Holding Corp. (NASDAQ: ACDC) (\"ProFrac\", or the \"Company\") today announces that it is evaluating strategic options to maximize and realize the full value of its Proppant Production segment, which operates through its wholly-owned Alpine Silica subsidiary. A variety of options are under strategic review, including a public offering, a sale or merger of Alpine Silica and/or a potential recapitalization.\n\n\"Vertical integration has always been part of our vision for ProFrac, which we believe provides a unique competitive advantage,\" stated Ladd Wilks, Chief Executive Officer. \"Alpine Silica is a key component to this strategy and that will continue as we look at the right strategic option – one that we believe will benefit from our vertical integration while enhancing our commercial capabilities for unaffiliated customers.\" \nMatt Wilks, Executive Chairman, said, \"After our recent acquisitions, Alpine Silica is now the largest proppant producer in the industry with a multi-basin footprint. Alpine Silica has entered into multiple attractive long-term proppant supply contracts with unaffiliated customers ramping into 2024. As we continue to develop this contract position, we believe that Alpine Silica can support a different leverage profile and a significantly lower cost of capital as compared to the rest of ProFrac, yielding a higher valuation reflective of different business drivers.\"\nIn connection with its strategic review, the Company also announces that entities affiliated with its largest shareholders, the Wilks Family, have invested $50 million in perpetual convertible preferred equity securities (the \"Preferred Equity\") issued by the Company at a conversion price of $20.00 per share. Proceeds of the investment will primarily be used to reduce the Company's indebtedness. \"This equity investment demonstrates the Wilks Family's unwavering confidence in ProFrac and facilitates optimizing the Company's capital structure by enabling a future potential separation of Alpine Silica,\" added Matt Wilks.\nCommenting on the Wilks Investment, Lance Turner, Chief Financial Officer, said, \"We are pleased that the Wilks Family continues to support ProFrac and is making this investment on very favorable terms for the Compa...