USA Compression Partners (USAC) announced Monday it's buying J-W Power Company for approximately $860 million, a deal that will substantially expand its compression services business and create one of the largest horsepower fleets in the industry.

How the Deal Works

The purchase will be split evenly between cash and equity. USAC is putting up $430 million in cash, which it'll initially pull from its revolving credit facility. The other half comes in the form of roughly 18.3 million new common units issued to the seller, also valued at $430 million.

The unit price is based on the 10-day volume-weighted average price as of November 26, 2025, with a collar set between $23.25 and $23.50—effectively priced at $23.50. The transaction is expected to wrap up in the first quarter of 2026, pending the usual regulatory approvals and closing conditions.

What USAC Gets From This

The big story here is scale. Once the deal closes, the combined company will operate a fleet of about 4.4 million active horsepower. That's a meaningful jump that strengthens USAC's position across major U.S. energy regions including the Permian Basin, Bakken, Gulf Coast, Northeast, Mid-Continent, and Rockies.

Beyond just adding equipment, the acquisition diversifies the business mix. J-W Power brings aftermarket services, parts distribution, and specialized manufacturing capabilities, plus a solid roster of established customer relationships built over time.

The deal cements USAC's leadership in mid- to large-horsepower compression and should deliver immediate financial benefits through accretion to distributable cash flow. Management also highlighted the attractive valuation of roughly 5.8x projected 2026 adjusted EBITDA before synergies, along with a faster route to bringing leverage below 4.0x.

What Management Is Saying

"By adding J-W Power Company's high-quality fleet and expanding our presence in key basins, we are excited to expand our position as a leading provider of compression services," said Clint Green, president and CEO of USAC. "The combined entity will deliver meaningful scale, broaden customer relationships, and enhance our ability to service the growing demand for natural gas compression."

Price Action: USAC shares were up 1.35% at $25.51 in premarket trading Monday.