Kevin Dowd January 10, 2017
Keane Group, a provider of well-completion services that’s been backed by Cerberus Capital Management since 2011, has set terms for its initial public offering. The Houston-based company plans to sell 15.3 million shares on the NYSE under symbol FRAC for between $17 and $19 each, and another selling stockholder will offer an additional 1.4 million shares, per an SEC filing. A midpoint pricing would raise more than $275 million and generate an initial market cap of about $1.85 billion.
If Keane hits the public markets in 2017, it could be a rare gusher in a US energy IPO market that’s run dry during the past two years. There were somewhere between seven and 11 PE-backed IPOs in the sector every year from 2011 to 2014, according to the PitchBook Platform. That figure plummeted to just three in 2015, and the market cooled even further last year when just two PE-backed energy companies in the US—Extraction Oil & Gas (NASDAQ: XOG) and Mammoth Energy Services (NASDAQ: TUSK)—held public offerings.
A Keane IPO would also be a somewhat unusual occurrence for Cerberus. While 86 different private equity firms have backed a completed energy IPO in the US since the start of 2010, the New York-based investing behemoth is not yet among them.
The firm to conduct the most IPOs in the sector during that timeframe is Riverstone, with seven—about one per year, on average. Another investor focused entirely on the energy sector, Natural Gas Partners, ranks second, with six such exits. Pan-industry juggernaut The Carlyle Group, meanwhile, rounds out the top three with five.