v3.26.1
Acquisitions
 6 Months Ended
Jun. 30, 2026
Business Combination [Abstract]  
Acquisitions
4.
Acquisitions

Ranger Water Midstream

On June 22, 2026, the Company acquired 100% of the equity interests of Ranger Water Midstream LLC (“Ranger”). The acquisition was accounted for as a business combination in accordance with ASC 805, Business Combinations, using the acquisition method of accounting. Under this method, the assets acquired and liabilities assumed were recorded at their respective fair values as of the acquisition date.

As part of the acquisition, the Company acquired produced water gathering and disposal assets, a produced water recycling facility, and brackish water supply assets, located in Lea County, New Mexico. The produced water assets consist of two wells and associated facilities, together with approximately 28 miles of pipeline. The brackish water supply assets consist of nine brackish water wells and approximately 49 miles of pipeline.

 

The following table summarizes the preliminary fair values assigned to assets acquired and liabilities assumed as of the acquisition date:

 

Fair Value of Consideration Transferred:

 

 

 

Total consideration

 

$

82,852

 

 

 

 

Assets Acquired and (Liabilities) Assumed:

 

 

 

Cash and cash equivalents

 

 

92

 

Accounts receivable

 

 

4,662

 

Prepaid and other assets

 

 

287

 

Property and equipment

 

 

45,442

 

Intangible assets(1)

 

 

34,537

 

Accounts payable

 

 

(679

)

Accrued expenses and other liabilities

 

 

(1,489

)

Net tangible assets acquired and (liabilities) assumed

 

$

82,852

 
(1)
Acquired intangible assets solely consists of customer contracts that will be amortized straight-line over 15 years.

 

The purchase accounting is preliminary with respect to certain assets acquired and liabilities assumed. The provisional amounts recognized for identifiable assets acquired and liabilities assumed may be adjusted during the measurement period as the Company

continues to gather and evaluate information about the facts and circumstances that existed as of the acquisition date. The Company expects to complete the purchase price allocation as soon as practicable, but no later than one year from the acquisition date.

Revenues and operating income before income taxes attributable to the Ranger acquisition for the period from June 22, 2026 through June 30, 2026 were approximately $0.7 million and $0.2 million, respectively.

Pro Forma Results

 

The unaudited pro forma financial information presented below was derived from historical financial records of the Company and Ranger and presents the combined operating results for the periods presented as if the acquisition had occurred on January 1, 2025. The unaudited pro forma operating results include adjustments to reflect (1) incremental depreciation and amortization expense, (2) increased interest expense related to the additional borrowings incurred to fund the Ranger acquisition, and (3) elimination of historical Ranger operating and administrative expenses that would not have continued under the Company’s operations.

Accordingly, the following unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the Ranger acquisition had occurred at the beginning of fiscal year 2025, nor are they indicative of the Company’s future results of operations:

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2026

 

 

2025

 

 

2026

 

 

2025

 

Revenue

 

$

223,559

 

 

$

99,060

 

 

$

429,077

 

 

$

201,789

 

Net income

 

$

15,047

 

 

$

4,787

 

 

$

23,208

 

 

$

5,781

 

WaterBridge Combination

Subsequent to the WaterBridge Combination, management identified a $1.1 million adjustment to working capital for collectability of accounts receivable resulting in an associated adjustment to goodwill during the six months ended June 30, 2026.