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Enservco has agreed to acquire Buckshot Trucking, the the company announced Last week.
Enservco, which provides well installation services to the oil and gas industry, said the purchase creates a new revenue stream and ushers in its entry into logistics. The $5 million deal, which is expected to close in the second quarter, includes $3.75 million in cash and $1.25 million in cash Enservco shares, according to the announcement.
“Buckshot provides a strong complement to our current service offerings with the added benefit of not being dependent on winter weather,” Enservco President and CEO Richard Murphy said in a statement. “Buckshot will also provide a material improvement in operational and financial visibility, which benefits our business, shareholders and other stakeholders.”
The acquisition creates a new operating division for Enservco, which the company says allows it to expand its customer base beyond the oil and gas business.
Buckshot’s unaudited EBITA for 2023 is estimated at $2.3 million on revenue of $8.2 million, nearly double the company’s revenue from 2021, according to the release.
Enservco said it needs to raise additional capital either through equity or debt, or both, to fund the $3.75 million cash payment due at closing.
Buckshot owners Tony Sims and Jim Fate will remain in the trucking business. The Fort Lupton, Colorado-based carrier was founded in 2017 and has operations in North Dakota, Texas and Utah, and a primary base of operations in Casper, Wyoming.
Sims recognizes that the combination creates growth opportunities for both companies.
“In addition to the identified list of potential expansion targets in current markets, we look forward to expanding our operations into other areas based on Enservco’s extensive operational footprint and customer base,” Sims said in the release.