Exterran Corporation shares jump 50%, here is why

Exterran Corporation (NYSE: EXTN) shares are up more than 50% after the company and Enerflex Ltd announced a business merger to establish a leading integrated international energy infrastructure provider.

Exterran and Enerflex merge to form an international energy infrastructure provider

The combined company will run as Enerflex, with headquarters in Calgary, Alberta, Canada. Enerflex's capacity to service clients in critical water, energy transition, and natural gas,  markets will be strengthened due to the Transaction's increased scale and economies. At the same time, stockholder value will be enhanced via sustained increases in cash flow generation and profitability. Enerflex CEO and President Marc Rossiter commented:

The businesses will merge in an all-stock transaction. Enerflex will buy all of Exterran's outstanding common stock for 1.021 Enerflex shares for each Exterran common share, resulting in roughly 124 million Enerflex outstanding common shares at closing, which implies a combined market capitalization of about US$1.5 billion. Rossiter added:

Exterrrn values the Transaction at $735 million

Exterran's deal value is about US$735 million, representing an 18% premium over the company's market value as of January 21, 2022. Enerflex and Exterran shareholders will possess roughly 72.5 percent and 27.5 percent of the combined company, respectively.

The combined company will continue to trading on the Toronto Stock Market ("TSX"), with plans to seek a listing on either the New York Stock Exchange or the NASDAQ exchange. Andrew Way, Exterran CEO, said: