Comstock Secures $600 Million Investment from Sixth Street in Pinnacle Gas Services
Comstock Resources, Inc. has finalized a strategic partnership with Sixth Street, which invested $600 million for a 27% stake in Pinnacle Gas Services LLC. This deal elevates Pinnacle's valuation to $2.2 billion and solidifies Comstock's majority ownership at 73%, facilitating debt reduction and operational enhancements.
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Comstock Resources, Inc. has sold a 27% non-controlling equity interest in Pinnacle Gas Services LLC to Sixth Street for $600 million, valuing Pinnacle at $2.2 billion. Following the transaction, Comstock retains a 73% controlling stake, which could increase to 80.5% as Sixth Street's ownership decreases upon meeting certain return hurdles.
Proceeds from this investment will eliminate $445 million in preferred equity and all outstanding debt, reducing Pinnacle's fixed charges by $40 million annually. The partnership enhances Comstock's operational control and positions Pinnacle to support growth in the Western Haynesville region, vital for addressing increasing natural gas demands. This strategic move is expected to improve Comstock's financial stability and operational efficiency.
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