USA Compression Expands with $860 Million Deal Boosting Fleet by 4.4 Million Horsepower

Basio badr

ago 54 minutes

USA Compression Expands with $860 Million Deal Boosting Fleet by 4.4 Million Horsepower

USA Compression Partners (NYSE: USAC) has announced a significant move to enhance its fleet and market presence. The company has entered into a definitive agreement to acquire J-W Power Company for an estimated $860 million. This strategic acquisition is poised to expand USA Compression’s operational capacity tremendously.

Transaction Overview

The deal entails two key components: a cash payment of $430 million and the issuance of approximately 18.3 million new common units worth another $430 million. This payment is based on the 10-day volume-weighted average price (VWAP) of $23.50 per unit, established as of November 26, 2025. The transaction is anticipated to finalize in the first quarter of 2026, pending regulatory approvals and customary conditions.

Impact on Operational Scale

The acquisition will notably enhance USA Compression’s operational scale, increasing its fleet to around 4.4 million active horsepower. This growth extends the company’s influence in key U.S. energy sectors, notably:

Permian Basin
Bakken
Gulf Coast
Northeast
Mid-Continent
Rockies

Strategic Benefits

By assimilating J-W Power Company, USA Compression is set to broaden its business mix. The acquisition supports:

Strengthening of aftermarket services
Enhancement of parts distribution
Expansion of specialized manufacturing capabilities

Additionally, the deal will introduce a diverse and high-quality customer base, fostering established, long-term relationships across the industry.

Market Positioning and Financial Outlook

This acquisition not only cements USA Compression’s leadership in mid- to large-horsepower compression services but also promises immediate financial benefits. The transaction is valued at approximately 5.8 times projected 2026 adjusted EBITDA, excluding synergies. It is anticipated to help USAC leverage its balance sheet below 4.0 times, further strengthening its market position.

Management Insights

Clint Green, the president and CEO of USA Compression, expressed enthusiasm over the deal, stating, “By adding J-W Power Company’s high-quality fleet and expanding our presence in key basins, we are excited to expand our position as a leading provider of compression services.” He emphasized that the merged entity will significantly enhance customer relationships and address the rising demand for natural gas compression.