Fracking Water Provider Select Energy Considers a Sale
(Bloomberg) -- Select Energy Services Inc., a provider of water to shale drillers, is in the early stages of considering a sale, according to people familiar with the matter.
The Gainesville, Texas-based company has spoken to advisers about exploring strategic options, including a potential sale, said the people, who asked to not be identified because the matter isn’t public. Select Energy Services hasn’t made a final decision and could opt to remain independent, the people said.
Chris George, a spokesman for the company, declined to comment on any specific sale considerations.
“We are always evaluating our strategic options, as can be seen from our recent decisions to divest of certain non-core businesses as well as to recently re-segment the reporting structure of the business,” George said.
Select Energy Services shares rose as much as 7.6% in New York trading Friday. The stock was up 4.2% to $12.35 at 11:41 a.m., valuing the company at $1.3 billion.
The company delivers water to energy explorers for fracking, the blasting of shale rock to extract oil and gas -- a process that requires immense amounts of water. Select Energy Services generated the largest portion of its sales last year in the Permian Basin of West Texas and New Mexico, where water is especially valuable because of the dry climate.
The company also operates a division for handling chemicals used in fracking.
Founded in 2007, Select Energy Services went public in 2017, shortly before merging with closely held rival Rockwater Energy Solutions. Its largest shareholder is SCF Partners, a Houston-based investment firm founded by L.E. Simmons, which owns a 20% stake, according to data compiled by Bloomberg.
©2019 Bloomberg L.P.