Kodiak Gas Services will pay down revolver with senior note proceeds

By Mary-Katherine Stinson

Lexington, Ky., Jan. 29 – Kodiak Gas Services, LLC plans to use proceeds from a $750 million private offering of senior notes due 2029 for debt repayment, according to a news release.

Specifically, proceeds will be used to partially repay the outstanding debt under the Kodiak’s revolving asset-based loan credit facility and to pay related fees and costs associated with the closing of the company’s acquisition of CSI Compressco LP.

In connection with closing of the acquisition, the company intends to use proceeds from additional draws on the revolver to repay, terminate and/or redeem all of CSI’s existing long-term debt.

As previously reported, on Dec. 19 the two companies announced that they had executed a definitive merger agreement under which Kodiak would acquire CSI Compressco in an all-equity transaction valued at about $854 million, including the assumption of $619 million of net debt, based on the closing price of Kodiak’s stock on Dec. 18.

Based in Montgomery, Tex., Kodiak supplies contract labor and mechanical expertise for end users of compression, dehydration, processing and treating equipment.

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