Select Water Solutions (WTTR) investor relations material

Deal rationale and strategic fit

• Acquisition of a leading private water midstream company (Pilot Water Solutions) expands infrastructure and strengthens market leadership in the Delaware Basin, enhancing both recycling and disposal capabilities and full-lifecycle water services.

• The combined network will manage scaled recycling and disposal, supporting a recycle-first strategy and optimizing lifecycle economics of produced and treated water.

• Adds scalable disposal capacity, high-value pore space, and long-term contract inventory, supporting growth as the basin matures.

• Diversifies and stabilizes cash flows with a blue-chip customer base and long-term, production-based contracts.

• Integration creates a one-stop-shop water management solution, improving customer relationships and offering both recycling and disposal options.

Financial terms and conditions

• Aggregate consideration totals $700 million: $600 million in cash and $100 million in Class A common stock, plus up to $15 million contingent earnout based on operational milestones.

• Sellers may receive a true-up payment if share price declines within six months post-closing.

• Debt financing commitments secured from JPMorgan and Bank of America; cash portion funded by cash on hand and committed debt.

• Pro forma net leverage expected to remain below 2.0x at closing, with transaction multiples of 6.8x 2026E Adj. EBITDA and 5.2x 2027E EBITDA including synergies.

Synergies and expected cost savings

• Targeting $10–$15 million in annual cost synergies within 12–18 months post-close, incremental to 2027 forecasts.

• Significant revenue synergy potential identified, especially in the Delaware Basin, with further opportunities expected as integration progresses.

• Additional $20 million annualized EBITDA from a new MVC contract starting in 2027.

• Integration expected to improve operational efficiency and margin profile through increased utilization and streamlined processes.