Keane Group Inc. (NYSE:FRAC) (‘Keane') entered into a definitive agreement to acquire C&J Energy Services Inc. (NYSE:CJ) (‘C&J') for approximately $760 million in a merger of equals transaction on June 16, 2019. Under the terms of the merger agreement, C&J shareholders will receive 1.6149 shares of Keane common stock for each share of C&J common stock owned. Pursuant to the agreement, each outstanding C&J stock option will convert into a stock option relating to shares of Keane common stock, each outstanding C&J performance share award will convert into a Keane performance share award relating to shares of Keane common stock, each outstanding C&J restricted stock unit award will convert into a Keane restricted stock unit award and each outstanding C&J restricted stock award will convert into a restricted award relating to shares of Keane common stock. The number of shares of C&J common stock subject to C&J performance share awards shall be deemed to be the number of shares subject to the C&J performance share award with performance deemed achieved at target performance levels. The merger agreement permits C&J to pay its shareholders a cash dividend of $1 per share prior to closing. Upon closing, Keane and C&J shareholders will, in the aggregate, each own approximately 50% of the equity of the combined company on a fully diluted basis. The share exchange is expected to be tax-free. Either of Keane or C&J may be required to pay the other party a fee of $30 million in the event of termination of the transaction under certain circumstances.

Upon close, Patrick Murray, Chairman of the C&J Board of Directors will serve as Chair of the combined company's Board of Directors, and Robert Drummond, Chief Executive Officer of Keane, will serve as President and Chief Executive Officer of the combined company. Jan Kees van Gaalen, Chief Financial Officer of C&J, will serve as Executive Vice President and Chief Financial Officer of the combined company, and Gregory Powell, President and Chief Financial Officer of Keane will serve as Executive Vice President and Chief Integration Officer of the combined company. The combined company's Board of Directors will comprise 12 directors, six of whom will be from the C&J Board, including the Chairman of C&J, and six of whom will be from the Keane Board, including the Chief Executive Officer of Keane. The combined company's corporate headquarters will remain in Houston, Texas. The combined company will operate under a new corporate name and trade under a new ticker symbol that will leverage the strengths of both brands. The combined company's corporate name and ticker will be announced prior to the close of the transaction. Upon the closing of the transaction, C&J and Keane will create a new leading well completion and production services company to be called NexTier Oilfield Solutions Inc. NexTier Oilfield Solutions' common stock will trade on the New York Stock Exchange under the ticker symbol “NEX”.

The transaction is subject to C&J and Keane shareholder approval, regulatory approvals, expiration or termination of any applicable waiting period, receipt of approvals under U.S. and certain foreign antitrust and competition laws, the authorization for listing of the Keane common stock to be issued in connection with the merger on the New York Stock Exchange and the receipt by each of Keane and C&J of a customary legal opinion that the merger will qualify as a “reorganization” within the meaning of Section 368(a) of the U.S. tax code and effectiveness of registration statement. The transaction has been unanimously approved by the Board of Directors of C&J. The Boards of C&J and Keane unanimously recommended that their shareholders vote in favor of the transaction. Citigroup Global Markets Inc. delivered a written opinion, dated June 16, 2019, to the Keane Board as to the fairness, from a financial point of view of the exchange ratio provided for pursuant to the merger agreement. Lazard Frères & Co. LLC rendered its opinion to the Keane Special Committee, that, the exchange ratio provided for in the merger was fair, from a financial point of view, to Keane. On July 18, 2019, Federal Trade commission approved the early termination of antitrust approval waiting period. The Keane Board has unanimously approved the transaction following the unanimous recommendation of its special committee comprising independent directors. Keane Investor Holdings LLC, the Keane family and certain members of Keane management who together own approximately 49% of the outstanding shares of Keane have entered into a support agreement to vote their shares in favor of the transaction. As of September 6, 2019, The Registration statement has been declared effective. As of October 22, 2019, the shareholders of both Keane Group and C&J Energy approved the transaction at their respective special meetings. The merger is expected to close in the fourth quarter of 2019. As of October 22, 2019, the transaction is anticipated to close on October 31, 2019. The merger is expected to be immediately accretive to cash flow per share, and to generate annualized run-rate cost synergies of $100 million within a year after closing.

Citigroup Global Markets Inc. acted as financial advisor to Keane. Stuart D. Freedman, Michael Gilligan, Antonio Diaz-Albertini, Ian Levin, Kirby Chin, David Passey and Andrew Fadale from Schulte Roth & Zabel LLP served as legal advisors to Keane. Lazard Frères & Co. LLC acted as financial advisor and fairness opinion to C&J. Chris May, Breen Haire and Ana Sanchez of Simpson Thacher & Bartlett acted as legal advisor to the special committee of the Keane Board. Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC acted as financial advisors to C&J. Adam D. Larson, P.C., Adam Larson, Douglas E. Bacon, Kim Hicks and Alex Rose, Matthew Pacey, Scott Price, Mark Dundon, William Bos and Kimberly Perdue, Paul Tanaka, Brooksany Barrowes, David MacDonald, Ian John, Marin Boney, Carla Hine, Sarah Jordan and Mike Robert-Smith, Alexandra Mihalas and Michael Schulman of Kirkland & Ellis acted as legal advisors to C&J. Morgan Stanley & Co. LLC provided a fairness opinion on the deal to C&J. Richard Fischetti of Shearman & Sterling LLP represented Citigroup. Jeff Floyd of Vinson & Elkins L.L.P acted as legal advisor to Morgan Stanley & Co. LLC. Morgan Stanley & Co. LLC also provided written opinion to Board of C&J. Citigroup delivered a written opinion to the Keane Board. American Stock Transfer & Trust Company, LLC acted as transfer agent for C&J and Keane. Innisfree M&A Incorporated acted as proxy solicitor to C&J. Innisfree M&A Inc. assisted in the solicitation of proxies for C&J and will be paid fee of $0.02 million. Lazard Frères will be paid $1 million in fee for providing opinion and $5 million in total. Morgan Stanley will be paid fee of $0.75 million for providing opinion and $11.25 million for transaction. Citigroup will pay $1 million for providing opinion and $9.25 million in total. MacKenzie Partners, Inc. acted as solicitation agent for Keane and will be paid a fee of approximately $20,000. Josh Davidson of Baker Botts L.L.P. acted as the legal advisor to the Special Committee of the Board of Keane.

Keane Group Inc. (NYSE:FRAC) (‘Keane') completed the acquisition of C&J Energy Services Inc. (NYSE:CJ) (‘C&J') in a merger of equals transaction on October 31, 2019.