- Mammoth Energy Services (NASDAQ: TUSK) sold its infrastructure subsidiaries for $108.7 million.
- The company's cash position has grown to approximately $160 million following the sale.
- Mammoth announced the purchase of eight small passenger aircraft for $11.5 million.
Mammoth Energy Services, Inc. (NASDAQ: TUSK) announced a significant transaction with the sale of its infrastructure subsidiaries, including 5 Star Electric, Higher Power Electrical, and Python Equipment, to Peak Utility Services Group for $108.7 million. The deal includes immediate cash proceeds of $98.3 million, while $10.4 million is held in escrow for post-closing adjustments and liabilities until May 2026.
With this transaction, Mammoth Energy's cash reserves have expanded to approximately $160 million, significantly enhancing the company's liquidity and investment capacity. Additionally, Mammoth has amended its credit facility to permit up to $50 million in stock repurchases, provided the unrestricted cash remains above $50 million after each transaction, along with broadening investment opportunities in equity and private securities.
As part of its strategic capital redeployment, Mammoth has invested $11.5 million in acquiring eight small passenger aircraft. These aircraft are leased to a commuter airline under long-term agreements, providing immediate returns, and diversifying Mammoth's rental services. The positive financial outlook for Q1 2025 anticipates a sequential improvement and a positive Adjusted EBITDA, reflecting financial resilience following the divestiture.
The transition of current CEO Phil Lancaster to Peak Utility Services by July 2025 marks a strategic shift aligning with Mammoth's new direction. Meanwhile, the search for a successor CEO is underway to continue guiding Mammoth through its strategic transformation.
