Cactus, Inc. (NYSE:WHD) entered into definitive agreement to acquire FlexSteel Pipeline Technologies, Inc. for approximately $700 million on December 30, 2022. Cactus is acquiring FlexSteel on a cash-free, debt-free basis, for total upfront consideration of approximately $621 million, subject to customary purchase price adjustments and earn-out payment of up to $75 million to be paid in mid-2024. Cactus has obtained fully committed bridge financing that it can use to fund the upfront purchase price together with cash on hand. Amount of up to $375million is obtained from Bridge Facility. Cactus consists of 0.099469 million shares of Class A Common Stock, of which 0.99469 million shares are issued and outstanding, and 530 shares of Class B Common Stock, of which (i) 89 shares are issued and outstanding as of the date hereof and (ii) 279 shares are issuable by the Company in exchange for outstanding RSUs. Cactus intends to finance the acquisition of FlexSteel through a mix of cash, debt and/or equity. the respective board of directors of Cactus and the Cactus and the sole member have approved this Agreement and the Merger and the related transactions contemplated hereby, upon the terms and subject to the condition. The deal subject to regulatory approvals and other customary conditions. FlexSteel?s current President and Chief Executive Officer, Thirucherai Sathyanarayanan, will continue to lead the business, which generated revenue of approximately $265 million for the nine months ended September 30, 2022. The closing is expected to occur in early 2023. J.P. Morgan Securities LLC is serving as the exclusive financial advisor to Cactus and Jason M. Jean, Matthew B. Grunert, Robert S. Nichols, Don J. Lonczak, Constance Gall Rhebergen, Tony L. Visage, Timothy A. Wilkins, Vince E. Morgan, Tamara L. McKinzie-Ortega of Bracewell LLP and Baker Botts L.L.P. are acting as legal advisors to Cactus, Inc. Morgan Stanley & Co. LLC is serving as financial advisor to FlexSteel and Chris Rowley, David Peck, Natan Leyva, Lina Dimachkieh, David D?Alessandro, Dario Mendoza, Melissa Spohn, Katherine Mull, Sean Becker, Alex Bluebond, Matt Dobbins, Cris Dewar, Craig Zieminski, Matt Stammel, Sarah Mitchell, Hill Wellford, David Smith, Evan Miller, Ramey Layne, Robert Kimball, Joanna Enns, Fry Wernick, Brian Howard, Elizabeth Krabill McIntyre and Rajesh Patel of Vinson & Elkins LLP is acting as legal advisors to FlexSteel Pipeline Technologies, Inc. Erland Modesto, Brian E. Rosenzweig, Dave Azarkh of Simpson Thacher is advising J.P. Morgan in providing committed debt financing for Cactus, Inc.

As of January 10, 2023 Cactus, Inc. announced the commencement of an underwritten offering of $125 million of its Class A common stock. Cactus intends to offer the underwriters an option to purchase up to $18,750,000 of additional shares of common stock at the public offering price, less underwriting discounts and commissions. Cactus intends to use the net proceeds from this offering to finance a portion of its previously announced acquisition of FlexSteel Technologies Holdings, Inc. and its affiliates. On February 7, 2023 Cactus announced the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The expiration of the HSR waiting period occurred at 11:59 p.m. Eastern Standard Time on February 6, 2023, without any action taken by the Federal Trade Commission or the U.S. Department of Justice. As of February 8, 2023, the transaction is expected to be closed during the first quarter of 2023. In connection with the acquisition, Cactus amended and restated its existing credit facility to provide for a term loan of $125 million and $225 million in revolving commitments. Upon closing, $30 million has been drawn on the revolving portion of the facility in addition to funding the $125 million term loan. As on March 1, 2023, Cactus, Inc. (NYSE:WHD) completed the acquisition of FlexSteel Pipeline Technologies, Inc.

Cactus, Inc. (NYSE:WHD) completed the acquisition of FlexSteel Pipeline Technologies, Inc. on February 28, 2023. The consideration comprised of a purchase price of $624.2 million (on a debt-free, cash-free basis) paid at closing, subject to certain working capital, debt and other customary adjustments set forth in the merger agreement and a potential future earn-out payment of up to $75 million to be paid no later than the third quarter of 2024, if certain revenue growth targets are met by the FlexSteel Business. Cactus funded the upfront purchase price using a combination of $165.6 million of net proceeds received from a public offering of shares of Cactus' Class A common stock completed on January 13, 2023, borrowings under the Amended ABL Credit Facility which provides for a term loan of $125.0 million, and $225.0 million in revolving commitments, up to $20.0 million of which is available for the issuance of letters of credit and available cash on hand at the time of closing.