Helix Exploration (AIM:HEX), the AIM-listed helium producer, has agreed to acquire the Keyes Helium Complex in Oklahoma for US$11 million, a deal that would transform the company from a raw gas producer into an integrated wellhead-to-liquid supplier.
The seller is Badger Midstream, and the acquisition is being funded through a placing to raise up to £16 million alongside a retail offer via the RetailBook platform of up to £1.6 million, both priced at the same issue price.
The Keyes facility is one of only six operational helium liquefaction plants in the United States and operates on an independent, multi-source basis, capable of processing helium from Helix's own Rudyard production, third-party suppliers, and tube trailers.
The complex generated revenue of approximately US$2.91 million and EBITDA of US$1.42 million in the five months ended 31 May, against a replacement cost the company estimates at around US$31 million, implying a 65% acquisition discount.
Of the net proceeds, approximately US$14.6 million covers the $10 million cash consideration, transaction costs, a working capital adjustment and initial operating and upgrade expenditure at Keyes; the remaining around $4 million funds four additional production wells at Rudyard at approximately US$1 million each.
"Spot helium prices are up approximately 33% year over year, with periodic spikes exceeding 50%," said chief executive Bo Sears, pointing to structural US supply constraints as the Bureau of Land Management's Cliffside reserve winds down.
Completion is expected shortly after admission, with US$1 million held in escrow for 12 months against potential warranty claims.
