August 22, 2017

U.S. Silica Holdings announced has acquired Mississippi Sand, a leading, low-cost frac sand mining and logistics company based in St. Louis, Mo. for $95.4 million in cash. The transaction closed earlier today. The plant, located in Festus, Mo., is capable of producing 1.2 million tons annually of mostly fine grade sand. Nearly two-thirds of its total production is 40/70 mesh that is in the highest demand today from customers. The plant can be expanded to 1.6 million tons of production per year with a modest capital investment. Mississippi Sand controls over 30 million tons of high-quality frac sand reserves on 650 acres through a long-term lease agreement. The facility is located 40 miles southeast of U.S. Silica’s Pacific, Mo. mine and plant.
Mississippi Sand’s distribution network is composed of five barge terminals and three rail terminals, two of which are unit train-capable, with a combined annual throughput of 2.2 million tons. The terminals serve many of the top basins, including the Mid-Continent, Marcellus/Utica, Eagle Ford, Fayetteville, Haynesville, Permian and the DJ basins. The plant enjoys some of lowest landed costs in the industry to the Haynesville and the Northeast through highly efficient barging. Currently, approximately 70% of the facility’s volumes are being sold into these two basins. Mississippi Sand’s rail terminals have access to most of the major Class 1 railroads, offering further optionality on origin and destination pairings.
The acquisition also includes an approximately one million ton-per-year dry plant located near Seagraves, TX.The plant is currently idled but could be utilized in the future as part of U.S. Silica’s in-basin strategy in the Permian. (Source and image: US Silica / Ottawa mine, Illinois)