Stratim Cloud Acquisition signed a binding letter-of-intent for a business combination with Force Pressure Control, a company in the energy services market.
Force provides pressure control-related rental tools and services required during frac and flowback well operations. The Company designs and assembles proprietary equipment that provides superior solutions for its clients and yields high margins, free cash flows and returns on invested capital. Force’s proprietary equipment is used in oil and natural gas production, as well as in geothermal “clean energy” applications.
Under terms of the LOI, the SPAC would acquire 100% of the equity interests of Force in exchange for 12 million shares of stock and $120 million in cash or notes. The deal under consideration includes an earnout of up to 3 million additional shares based on the combined company’s 2023 EBITDA exceeding certain levels.
Stratim raised $250 million in a March 2021 IPO.
If both sides reach a definitive purchase agreement, Stratim said it expects to close the deal by the end of the first quarter. However, the SPAC’s deadline to complete a deal is March 16 so it may yet have to seek an extension.
EF Hutton and Johnson Rice & Company are acting as capital markets advisors to SCAC. Legal counsel to SCAC is Skadden, Arps, Slate, Meagher & Flom. Read more.
