Ranger Energy Agrees to Buy STEP's U.S. Coiled Tubing Fleet for $27.5 Million, or About 2.5x 2027 EBITDA

by Ellis Vance · September 1, 2026

Small-Cap Markets Correspondent, The SmallCap Signal

Ranger Energy Services, Inc. (NYSE: RNGR) has agreed to acquire the U.S. coiled tubing assets of STEP Energy Services for approximately $27.5 million, the Houston-based well-services company said in a Business Wire release dated Aug. 31. The deal would make Ranger the second-largest coiled tubing provider in the Lower 48, according to the announcement, and is expected to close on or about Sept. 11.

The consideration is split between $22.5 million in cash and $5.0 million in equity, with the stock component to be sized off the 30-day trailing volume-weighted average price ahead of closing, per the release. Ranger said it will fund the cash portion with borrowings under its revolving credit facility and expects post-close borrowings of roughly $30 million. The release separately flags approximately $10 million of first-quarter post-close borrowings for working capital and pre-close capital commitments, which it says will weigh on 2026 cash flows.

What Ranger is buying is a working business rather than a pile of idle iron. The package comprises 13 full coiled tubing spreads plus related equipment and inventory, certain property and vehicle lease obligations, and five operational facilities running from the Bakken through the Permian Basin and into South Texas — all inside Ranger's existing footprint, the company said. Approximately 220 coiled tubing professionals and support staff are expected to be hired. The transaction also brings STEP's COIL+ Extended Reach technology platform, used for extended-reach lateral work.

On the numbers Ranger disclosed, the price implies slightly more than 2.5 times anticipated 2027 EBITDA. The company said it expects the acquired assets to contribute $80 million to $90 million of revenue and more than $10 million of EBITDA in 2027, with at least $2.5 million of cost synergies in the first year, and to be accretive to earnings in 2027. EBITDA is a non-GAAP measure; consistent with common practice for forward-looking non-GAAP guidance, Ranger's release notes it cannot reconcile the projection to the nearest GAAP measure without unreasonable effort.

For a company Ranger's size, the deal is meaningful but not balance-sheet-bending. StockAnalysis.com data as of the Aug. 28 close put Ranger's market capitalization at $387.30 million on 23.40 million shares, with the stock at $16.55 and up roughly 18.5% over the prior year. The same data show $4.20 million of cash against $49.10 million of total debt, on trailing twelve-month revenue of $606.70 million and trailing EBITDA of $76.30 million. Layering roughly $30 million of expected post-close revolver borrowings onto that debt load is a real step up in leverage, though modest against the cash flow base.

Ranger framed the logic as commercial as much as financial, arguing the coiled tubing fleet creates pull-through opportunities for its high-specification workover rig segment — the idea being that customers already buying rig hours become easier to sell an integrated intervention package to.

"STEP's Coil+ Extended Reach technology is proven in the U.S. market," Stuart Bodden, Ranger's chief executive, said in the release, describing the transaction as another step in the company's growth path and praising STEP's leadership team.

On the seller's side, Steve Glanville, chief executive of STEP Energy Services, said in the release: "We believe Ranger is the right organization to carry this business forward," adding that the sale allows STEP to concentrate on strategic growth in Canada.

That Canadian focus has context. STEP is a Calgary-headquartered energy services company founded in 2011 that provides coiled tubing, fluid and nitrogen pumping and hydraulic fracturing services, with roughly 1,400 employees. It was taken private by ARC Energy Fund 8, a fund advised by ARC Financial Corp., in a transaction that closed Dec. 16, 2025 at $5.50 per share and saw STEP delisted from the Toronto Stock Exchange, according to a Business Wire release from Dec. 15, 2025. Divesting a U.S. service line is a recognizable post-buyout move.

The deal is being struck into a crude tape that has turned sharply higher on geopolitics. Brent crude was quoted intraday at $91.04 a barrel, up 3.34%, and West Texas Intermediate at $86.13, up 3.27%, in a report published Aug. 31 by The National; both are live quotes rather than settlements. It is worth being precise about which benchmark is where: Brent has cleared $90, while WTI — the grade that actually sets the economics for most U.S. onshore completion work — remains in the mid-$80s.

The catalyst, per an OilPrice.com report published Aug. 30, was renewed U.S.-Iran military exchange, including a U.S. strike on Iranian forces at Larak Island in the Strait of Hormuz that CENTCOM characterized as a limited action against minelaying forces, followed by Iranian retaliation against U.S. bases in Jordan. Reduced shipping through the Strait and renewed mining concerns have kept a risk premium in the price. Whether that premium converts into incremental U.S. completion activity — and therefore into utilization for 13 additional coiled tubing spreads — is the open question hanging over the economics Ranger has laid out.

The transaction is not yet closed and remains subject to customary conditions, including receipt of required third-party consents, and the release carries forward-looking-statement language flagging risks around completion, integration, employee retention and financing. King & Spalding LLP served as legal counsel to Ranger.

The broader backdrop for small caps is unhelpful at the margin. The S&P 500 finished Monday at 7,686.14, down 0.33% on the session but up about 2.6% for August, according to The Motley Fool's Aug. 31 market summary, which also noted rising expectations that the Federal Reserve will raise rates at its September meeting. A tightening bias is a notably different setup for leveraged, capital-intensive service companies than the easing cycle the market spent much of the past two years pricing. August nonfarm payrolls are due Friday.