Kodiak Gas Services (NYSE: KGS) plans $675M cash-and-stock DPS acquisition
Rhea-AI Filing Summary
Kodiak Gas Services, Inc. plans to acquire Distributed Power Solutions, LLC for approximately
The acquisition aims to add about 384 MW of Caterpillar-powered distributed generation assets and expand Kodiak beyond gas compression into fast‑growing end markets such as data centers and microgrids. Kodiak expects the transaction to be accretive to earnings and discretionary cash flow per share after closing, which is currently targeted for early April 2026, subject to regulatory approvals and customary conditions.
Positive
- Strategic expansion and stated accretion: Kodiak plans to acquire DPS for approximately $675.0 million, adding about 384 MW of Caterpillar-powered distributed generation focused on data centers and microgrids, and states the deal is expected to be accretive to earnings and discretionary cash flow per share.
Negative
- Higher leverage and equity issuance: The transaction is primarily funded with $575.0 million of borrowings under Kodiak’s ABL facility and about $100.0 million of new equity, raising pro forma leverage toward a 3.5x–4.0x range and causing dilution from 2,401,278 newly issued shares.
Insights
Kodiak is pursuing a $675M cash-and-stock acquisition of DPS to expand into distributed power and data-center markets.
Kodiak Gas Services agreed to buy Distributed Power Solutions for approximately
The company highlights DPS’s contracted power portfolio, multi‑year data center contracts and a fleet of turbines and reciprocating generators as strategic complements to Kodiak’s existing large‑horsepower compression expertise. Management states the acquisition is expected to be accretive to earnings and discretionary cash flow per share and to offer attractive unlevered returns on growth capital.
Pro forma leverage is illustrated around 3.8x based on estimated first‑quarter 2026 adjusted EBITDA, with a long‑term target range of 3.5x–4.0x and more than
UNITED STATES
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| Item 1.01 | Entry into a Material Definitive Agreement. |
On February 5, 2026, Kodiak Gas Services, Inc. (the “Company”) and Kodiak Gas Services, LLC, an indirect, wholly owned subsidiary of the Company (the “Buyer”), entered into a Membership Interest Purchase Agreement (the “Purchase Agreement”) among the Company, the Buyer, Mustang PRS, LLC (“Mustang”), Louisiana Machinery Company, L.L.C. (“LMC” and, together with Mustang, each a “Seller” and collectively, the “Sellers”) and Distributed Power Solutions, LLC, a Texas limited liability company (“DPS”), pursuant to which the Buyer agreed to purchase all of the issued and outstanding membership interests in DPS from the Sellers for an aggregate purchase price of approximately $675.0 million, subject to certain customary adjustments as set forth in the Purchase Agreement (the “Acquisition”), consisting of (i) $575.0 million of cash to be paid at closing of the Acquisition (the “Closing”) and (ii) 2,401,278 shares of the Company’s common stock, par value $0.01 per share (“Common Stock”), with a value of approximately $100.0 million, to be issued at the Closing (such shares of Common Stock, the “Stock Consideration”).
Completion of the Acquisition is subject to the satisfaction or waiver of certain customary closing conditions, including, among others, (i) the accuracy of the representations and warranties contained in the Purchase Agreement (subject to certain qualifications), (ii) the performance by the parties to the Purchase Agreement of their respective obligations under the Purchase Agreement in all material respects, (iii) the absence of legal restraints preventing the consummation of the transactions contemplated by the Purchase Agreement, including the Acquisition and (iv) the absence of the occurrence of a material adverse effect with respect to the Sellers and DPS. The Acquisition is currently expected to close in early April 2026, subject to satisfaction of customary closing conditions and regulatory approvals, including the expiration or termination of all waiting periods imposed under the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”).
The Purchase Agreement contains certain termination rights, including: (i) by either the Buyer or the Sellers if the Closing has not occurred prior to May 31, 2026 (the “Outside Date”), provided the terminating party is not then in breach, and provided that the parties may extend the Outside date for up to 30 days if such failure to satisfy the closing conditions is a result of the failure to obtain any necessary governmental or regulatory approvals; (ii) by the Buyer, if there exists a breach of representations and warranties or covenants of Sellers or the Company, such that a closing condition would not be satisfied (subject to Sellers’ right to extend the Outside Date and to have 30 days after receipt of notice from Buyer in order for Sellers to cure); (iii) by the Sellers, if there exists a breach of representations and warranties or covenants of Buyer, such that a closing condition would not be satisfied (subject to Buyer’s right to extend the Outside Date and to have 30 days after receipt of notice from Sellers in order for Buyer to cure); (iv) by either the Buyer or the Sellers if there is in effect a final, non-appealable order prohibiting, enjoining, restricting or making illegal the consummation of the transactions; or (v) at any time by mutual written agreement of the Buyer and the Sellers. The Purchase Agreement provides that upon the termination by the Sellers as a result of a breach of the representations and warranties or covenants of Buyer under the Purchase Agreement (subject to no other existing breaches by Sellers or the Company), the Buyer may be required to pay the Sellers a termination fee of $37.125 million.
The Purchase Agreement contains customary representations, warranties and covenants by each of the parties to the Purchase Agreement. In addition, the Purchase Agreement also contains customary pre-closing covenants, including the obligation of the Sellers and DPS to conduct DPS’ business in the ordinary course consistent with past practice in all material respects and to refrain from taking specified actions, subject to certain exceptions.
Pursuant to the Purchase Agreement, the Buyer has agreed to indemnify the Sellers and their affiliates, equity holders, partners, members, directors, managers, employees and agents against certain losses resulting from any breach of certain covenants and agreements of the Buyer. The Sellers have agreed to indemnify the Buyer and the Company and their respective affiliates, equity holders, partners, members, directors, officers, managers, employees and agents against certain losses resulting from any breach of a representation, warranty, agreement or covenant of the Sellers and for certain other matters; provided, the Company will obtain a representations and warranties insurance policy (the “RWI Policy”), and notwithstanding the foregoing, such coverage will serve as the Company’s sole remedy with respect to any breach of the Acquired Company’s representations and warranties, excluding claims related to the Acquired Company’s fraud, certain other matters and, for a period of one year after Closing, claims related to certain fundamental representations not covered under the RWI Policy solely up to the retention under the RWI Policy. The cost of the RWI Policy is borne entirely by the Company, and coverage under the RWI Policy is subject to customary deductibles and certain exclusions.
Pursuant to the terms of the Purchase Agreement, in connection with the Closing, the Company and the Sellers will enter into a registration rights agreement (the “Registration Rights Agreement”). Pursuant to the Registration Rights Agreement, the Company will grant the Seller certain rights to require the Company to file and maintain the effectiveness of a registration statement with respect to the resale of the common units to be issued as the Stock Consideration, and under certain circumstances, to require the Company to initiate underwritten offerings for the common units to be issued as the Unit Consideration. Under the terms of the Purchase Agreement, the Sellers have agreed not to dispose of any of the Common Stock
to be received as the Stock Consideration for a lock-up period of 180 days following the Closing with the exception of transfers to affiliates, the Company, and subsidiaries or pursuant to a merger, consolidation or other similar transaction involving the Company or its subsidiaries. The form of the Registration Rights Agreement is attached to the Purchase Agreement as Exhibit B. Pursuant to the Purchase Agreement in connection with the Closing, the Company will also enter into restrictive covenant agreements with the Seller and certain members of the Seller (and their members) and certain management of Seller, which will become effective upon the Closing and pursuant to which such restricted persons are subject to non-competition, non-solicit and non-hire provisions for a period beginning upon the Closing and ending on the third anniversary of the Closing. The form of the Restrictive Covenant Agreement is attached to the Purchase Agreement as Exhibit D.
The foregoing description of the Purchase Agreement and the transactions contemplated thereby is not complete and is qualified in its entirety by reference to the full text of the Purchase Agreement, a copy of which is filed herewith as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated by reference herein.
The Purchase Agreement contains representations and warranties by each of the parties to the Purchase Agreement, which were made only for purposes of the Purchase Agreement and as of specified dates. The representations, warranties and covenants in the Purchase Agreement were made solely for the benefit of the parties to the Purchase Agreement; may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for purposes of allocating contractual risk between the parties to the Purchase Agreement instead of establishing these matters as facts; and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the parties to the Purchase Agreement or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the Purchase Agreement, which subsequent information may or may not be fully reflected in the Partnership’s public disclosures, as applicable.
| Item 3.02 | Unregistered Sales of Equity Securities. |
The information regarding the Stock Consideration set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02. Any issuance of common units pursuant to the Purchase Agreement will be undertaken in reliance upon an exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), pursuant to Section 4(a)(2) thereof.
| Item 7.01 | Regulation FD Disclosure. |
On February 5, 2026, the Company issued a press release announcing the entry into the Purchase Agreement. The full text of the press release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference.
On February 5, 2026, the Company posted an investor presentation related to the announcement of the Acquisition. A copy of the investor presentation is furnished as Exhibit 99.2 hereto and is incorporated herein by reference.
In accordance with General Instruction B.2 of Form 8-K, the information furnished pursuant to Item 7.01 and the press release attached hereto as Exhibit 99.1 and the investor presentation attached hereto as Exhibit 99.2 relating to this Item 7.01 shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Forward-Looking Statements
This communication contains “forward-looking statements” and information based on the current beliefs of the Company. Forward-looking statements in this communication are identifiable by the use of the following words, the negative of such words, and other similar words: “anticipates”, “assumes”, “believes”, “could”, “estimates,” “expects,” “forecasts,” “goal,” “intends,” “may,” “might,” “plans,” “predicts,” “projects,” “seeks,” “should,” “targets,” “will” and “would.” Important factors that could cause actual results to differ from those indicated in the forward-looking statements in this communication include, but are not limited to: (i) the completion of the Acquisition on anticipated terms and timing, or at all, including obtaining regulatory approvals that may be required on anticipated terms; (ii) the anticipated tax treatment, unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies for the management, expansion and growth of the combined company’s operations and other conditions to the completion of the Acquisition, including the possibility that any of the anticipated benefits of the Acquisition will not be realized or will not be realized within the expected time period; (iii) the ability of the Company
to integrate its business with DPS’s business successfully and to achieve anticipated synergies and value creation; (iv) the risk that disruptions from the Acquisition will harm the Company’s business, including current plans and operations and that management’s time and attention will be diverted on transaction-related issues; (v) potential adverse reactions or changes to business relationships, including with employees, suppliers, customers, competitors or credit rating agencies, resulting from the announcement or completion of the Acquisition; (vi) potential business uncertainty, including the outcome of commercial negotiations and changes to existing business relationships during the pendency of the Acquisition that could affect the Company’s financial performance and operating results; (vii) certain restrictions during the pendency of the Acquisition that may impact the Company’s ability to pursue certain business opportunities or strategic transactions or otherwise operate its business; (viii) legislative, regulatory and economic developments, changes in local, national, or international laws, regulations, and policies affecting the Company; (ix) dilution caused by the Company’s issuance of additional shares of Common Stock in connection with the Acquisition; (x) the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; (xi) the Company’s ability to employ a sufficient number of skilled and qualified workers to combat the operating hazards inherent in the Company’s industry; (xii) changes in the distributed power industry, including sustained decreases in the supply of power generators, demand for electricity and distributed power; (xiii) the competitive nature of distributed power services industry in which the DPS and the Company will conduct its business; (xiv) the impact of adverse weather conditions; (xv) the level of, and obligations associated with, the Company’s indebtedness; (xvi) acts of terrorism or outbreak of war, hostilities, civil unrest, attacks against the Company, and other political or security disturbances; (xvii) the impacts of pandemics or other public health crises, including the effects of government responses on people and economies; and (xviii) other risk factors and additional information.
The Company believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical experience and present expectations or projections. These risks and uncertainties include, but are not limited to, those discussed throughout the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, and those discussed throughout the Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Part II, Item 1A. “Risk Factors” sections of the Company’s Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2025, June 30, 2025 and September 30, 2025, which are available on the Investor Relations page of the Company’s website at https://ir.kodiakgas.com// and on the website of the SEC at www.sec.gov.
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits. |
| Exhibit No. | Description | |
| 2.1* | Membership Interest Purchase Agreement, dated February 5, 2026, by and among Kodiak Gas Services, LLC, Kodiak Gas Services, Inc., Mustang PRS, LLC, Louisiana Machinery Company, L.L.C., and Distributed Power Solutions, LLC | |
| 99.1 | Press Release dated February 5, 2026 | |
| 99.2 | Investor Presentation dated February 5, 2026 | |
| 104 | Cover Page Interactive Data File (the cover page XBRL tags are embedded within the iXBRL document) | |
| * | Certain of the schedules and exhibits to the agreement have been omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished to the Securities and Exchange Commission upon request. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: February 5, 2026 | Kodiak Gas Services, Inc. | |||||
| By: | /s/ Jennifer Howard | |||||
| Jennifer Howard | ||||||
| Executive Vice President, General Counsel, | ||||||
| Chief Compliance Officer and Corporate Secretary | ||||||
Exhibit 99.1
|
NEWS RELEASE |
Kodiak Gas Services to Acquire Distributed Power Solutions
THE WOODLANDS, Texas – February 5, 2026 – Kodiak Gas Services, Inc. (NYSE: KGS) (“Kodiak” or the “Company”) today announced that it entered into a definitive agreement to acquire Distributed Power Solutions, LLC (“DPS”), a leading provider of turnkey, scalable and highly-reliable distributed power solutions serving a diverse set of customers and end markets, in an equity and cash transaction valued at approximately $675 million (the “Acquisition”), subject to adjustment in accordance with the purchase agreement. The purchase price includes $575 million in cash, subject to adjustment in accordance with the purchase agreement, and the issuance of 2,401,278 shares, representing approximately $100 million of Kodiak common stock, to the sellers.
Strategic Rationale and Transaction Highlights:
| • | Premium Generation Fleet: DPS’s fleet consists of approximately 384 MW of state-of-the-art distributed power generation assets driven by a mix of Caterpillar reciprocating engines and turbines. |
| • | Compelling Valuation: The DPS transaction value is equal to approximately 7.4x DPS’s estimated 2026 full year adjusted EBITDA and will be immediately accretive to earnings and discretionary cash flow per share. |
| • | Synergistic with Kodiak’s Compression Business: Kodiak has a strong track record of operating and maintaining large horsepower engines at extremely high reliability levels. Kodiak’s experienced team of over 700 Caterpillar-certified technicians, embedded maintenance routines and advanced fleet monitoring and management technologies will further enhance the reliability and real-time monitoring of DPS’s fleet. |
| • | Expands Customer Reach with Contracted Cash Flows: DPS will expand Kodiak’s customer base into high-growth digital infrastructure companies and deepen the Company’s relationships with certain upstream and midstream energy customers. Contract portfolio includes 100 MW serving a large data center operator providing 99.9% reliability for more than a year. As “bring your own power” has become the preferred solution for data center developers, Kodiak expects to extend the average life of its contract portfolio through long-term distributed power contracts. |
| • | Experienced Management Team: DPS’s management team will join Kodiak, bringing decades of commercial and operational expertise in distributed power. |
CEO Commentary
“Distributed power is a natural extension of our large horsepower operations skillset and meaningfully enhances our ability to deliver critical energy infrastructure solutions to our oil and gas customers, while opening new avenues of growth in the fast-growing digital infrastructure end market,” noted Mickey McKee, Kodiak’s President and Chief Executive Officer. “I commend Scott and the entire DPS team for their many successes to date, and I’m thrilled to welcome them to Kodiak.”
1
“Distributed power demand is growing rapidly. We believe that the speed-to-deployment and competitive pricing relative to an increasingly constrained power grid make distributed power an attractive option for primary, long-term power. Kodiak is committed to powering our critical energy future, and I’m confident that adding DPS will further our goal to help provide safe, reliable, and affordable energy to the world.”
Scott Milligan, President of Distributed Power Solutions, said, “This transaction represents an important milestone for DPS. We have built a scaled, high-quality fleet and a strong operating platform, and Kodiak is a natural platform to launch our next phase of growth. Our shared focus on safety, reliability, and execution positions the combined organization well to serve customers and create long-term value.”
Transaction Details
Under the terms of the membership interest purchase agreement, the seller will receive at closing (i) 2,401,278 million shares of Kodiak Gas Services common stock and (ii) $575 million in cash, subject to adjustment in accordance with the purchase agreement. The total transaction value is approximately $675 million, before transaction costs. and customary adjustments. The transaction has been approved by the Board of Directors of Kodiak, the Board of Managers of DPS and the sellers.
The transaction is expected to close in early April of 2026, subject to regulatory approvals and customary closing conditions, including the expiration or termination of all waiting periods imposed under the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended.
Conference Call and Additional Information
Kodiak will host a conference call for investors and other stakeholders on February 5, 2026 at 9:00 a.m. Eastern Time (8:00 a.m. Central Time). The conference call may be accessed by dialing (877) 407-4012 or via webcast at ir.kodiakgas.com.
A replay of the conference call will be available through February 19, 2026 and may be accessed by dialing (877) 660-6853 and using access code 13758641.
A presentation with additional information can be found on Kodiak’s investor relations website at ir.kodiakgas.com.
Advisors
Intrepid Partners, LLC is serving as exclusive financial advisor, and Sidley Austin LLP is serving as legal advisor, to Kodiak on the transaction.
Morgan Stanley is serving as exclusive financial advisor to DPS, and Jones Walker LLP is serving as legal counsel to DPS. Winston & Strawn LLP is serving as legal counsel to one of the seller parties.
About Kodiak
2
Kodiak is a leading contract compression services provider in the United States, serving as a critical link in the infrastructure that enables the safe and reliable production and transportation of natural gas and oil. Headquartered in The Woodlands, Texas, Kodiak provides contract compression and related services to oil and gas producers and midstream customers in high–volume gas gathering systems, processing facilities, multi-well gas lift applications and natural gas transmission systems.
Cautionary Note Regarding Forward-Looking Statements
This news release contains “forward-looking statements” and information based on the current beliefs of the Company. Forward-looking statements in this communication are identifiable by the use of the following words, the negative of such words, and other similar words: “anticipates”, “assumes”, “believes”, “could”, “estimates,” “expects,” “forecasts,” “goal,” “intends,” “may,” “might,” “plans,” “predicts,” “projects,” “seeks,” “should,” “targets,” “will” and “would.” Important factors that could cause actual results to differ from those indicated in the forward-looking statements in this communication include, but are not limited to: (i) the completion of the Acquisition on anticipated terms and timing, or at all, including obtaining regulatory approvals that may be required on anticipated terms; (ii) the anticipated tax treatment, unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies for the management, expansion and growth of the combined company’s operations and other conditions to the completion of the Acquisition, including the possibility that any of the anticipated benefits of the Acquisition will not be realized or will not be realized within the expected time period; (iii) the ability of the Company to integrate its business with DPS’s business successfully and to achieve anticipated synergies and value creation; (iv) the risk that disruptions from the Acquisition will harm the Company’s business, including current plans and operations and that management’s time and attention will be diverted on transaction-related issues; (v) potential adverse reactions or changes to business relationships, including with employees, suppliers, customers, competitors or credit rating agencies, resulting from the announcement or completion of the Acquisition; (vi) potential business uncertainty, including the outcome of commercial negotiations and changes to existing business relationships during the pendency of the Acquisition that could affect the Company’s financial performance and operating results; (vii) certain restrictions during the pendency of the Acquisition that may impact the Company’s ability to pursue certain business opportunities or strategic transactions or otherwise operate its business; (viii) legislative, regulatory and economic developments, changes in local, national, or international laws, regulations, and policies affecting the Company; (ix) dilution caused by the Company’s issuance of additional shares of Common Stock in connection with the Acquisition; (x) the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; (xi) the Company’s ability to employ a sufficient number of skilled and qualified workers to combat the operating hazards inherent in the Company’s industry; (xii) changes in the distributed power industry, including sustained decreases in the supply of power generators, demand for electricity and distributed power; (xiii) the competitive nature of distributed power services industry in which the DPS and the Company will conduct its business; (xiv) the impact of adverse weather conditions; (xv) the level of, and obligations associated with, the Company’s indebtedness; (xvi) acts of terrorism or outbreak of war, hostilities, civil unrest, attacks against the Company, and other political or security disturbances; (xvii) the impacts of pandemics or other public health crises, including the effects of government responses on people and economies; and (xviii) other risk factors and additional information.
3
The Company believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical experience and present expectations or projections. These risks and uncertainties include, but are not limited to, those discussed throughout the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, and those discussed throughout the Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Part II, Item 1A. “Risk Factors” sections of the Company’s Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2025, June 30, 2025 and September 30, 2025, which are available on the Investor Relations page of the Company’s website at https://ir.kodiakgas.com/ and on the website of the SEC at www.sec.gov.
Contact:
Kodiak Gas Services, Inc.
Graham Sones, VP – Investor Relations
ir@kodiakgas.com
4
Exhibit 99.2
Powering Our Critical Energy Future February 5, 2026
Disclaimer Cautionary Note Regarding Forward-Looking Statements. This presentation contains “forward-looking statements” and information based on the current beliefs of Kodiak Gas Services, Inc. (the “Company”). Forward- looking statements in this communication are identifiable by the use of the following words, the negative of such words, and other similar words: “anticipates,” “assumes,” “believes,” “could,” “estimates,” “expects,” “forecasts,” “goal,” “intends,” “may,” “might,” “plans,” “predicts,” “projects,” “seeks,” “should,” “targets,” “will” and “would.” Important factors that could cause actual results to differ from those indicated in the forward-looking statements in this communication include, but are not limited to: (i) the completion of the acquisition of Distributed Power Services, LLC (“DPS”) by the Company (the “Acquisition”) on anticipated terms and timing, or at all, including obtaining regulatory approvals that may be required on anticipated terms; (ii) the anticipated tax treatment, unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies for the management, expansion and growth of the combined company’s operations and other conditions to the completion of the Acquisition, including the possibility that any of the anticipated benefits of the Acquisition will not be realized or will not be realized within the expected time period; (iii) the ability of the Company to integrate its business with DPS’s business successfully and to achieve anticipated synergies and value creation; (iv) the risk that disruptions from the Acquisition will harm the Company’s business, including current plans and operations and that management’s time and attention will be diverted on transaction-related issues; (v) potential adverse reactions or changes to business relationships, including with employees, suppliers, customers, competitors or credit rating agencies, resulting from the announcement or completion of the Acquisition; (vi) potential business uncertainty, including the outcome of commercial negotiations and changes to existing business relationships during the pendency of the Acquisition that could affect the Company’s financial performance and operating results; (vii) certain restrictions during the pendency of the Acquisition that may impact the Company’s ability to pursue certain business opportunities or strategic transactions or otherwise operate its business; (viii) legislative, regulatory and economic developments, changes in local, national, or international laws, regulations, and policies affecting the Company; (ix) dilution caused by the Company’s issuance of additional shares of Common Stock in connection with the Acquisition; (x) the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; (xi) the Company’s ability to employ a sufficient number of skilled and qualified workers to combat the operating hazards inherent in the Company’s industry; (xii) changes in the distributed power industry, including [sustained decreases in the supply of power generators, demand for electricity and distributed power]; (xiii) the competitive nature of distributed power services industry in which the DPS and the Company will conduct its business; (xiv) the impact of adverse weather conditions; (xv) the level of, and obligations associated with, the Company’s indebtedness; (xvi) acts of terrorism or outbreak of war, hostilities, civil unrest, attacks against the Company, and other political or security disturbances; (xvii) the impacts of pandemics or other public health crises, including the effects of government responses on people and economies; and (xviii) other risk factors and additional information. The Company believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical experience and present expectations or projections. These risks and uncertainties include, but are not limited to, those discussed throughout the ‘Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, and those discussed throughout the Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Part II, Item 1A. “Risk Factors” sections of the Company’s Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2025, June 30, 2025 and September 30, 2025, which are available on the Investor Relations page of the Company’s website at https:// https://ir.kodiakgas.com// and on the website of the SEC at www.sec.gov. Non-GAAP Financial Measures. This presentation contains certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”), including adjusted gross margin, adjusted gross margin percentage, adjusted net income, adjusted EBITDA, adjusted EBITDA percentage, discretionary cash flow and free cash flow. Such non-GAAP measures should not be considered an alternative to, or more meaningful than, the most directly comparable measure of financial performance presented in accordance with GAAP. Moreover, such non-GAAP measures may not be comparable to similarly titled measures of other companies. However, we believe these non- GAAP financial measures provide useful information to investors because, when viewed with our GAAP results and the accompanying reconciliation, they provide a more complete understanding of our performance than GAAP results alone. See the Supplemental Slides for reconciliation of non-GAAP measures. Industry & Market Data. The market data and certain other statistical information used throughout this presentation are based on independent industry publications, government publications or other published independent sources. Although we believe these third-party sources are reliable as of their respective dates, we have not independently verified the accuracy or completeness of this information. Some data is also based on our good faith estimates and our management’s understanding of industry conditions. The industry in which we operate is subject to a high degree of uncertainty and risk due to a variety of factors. These and other factors could cause results to differ materially from those expressed in these publications. Intellectual Property. This presentation contains trademarks, trade names and service marks of other companies, which are the property of their respective owners. We do not intend our use or display of other parties’ trademarks, trade names or service marks to imply, and such use or display should not be construed to imply, a relationship with, or endorsement or sponsorship of us by, these other parties.
Transaction Overview Transaction Overview 1 SURGING TRACK RECORD $675 Million purchase price Increase in of Transforming $575M funded on ABL & Demand Businesses $100M KGS equity to DPS 384 MW2 fleet of Caterpillar ENERGIZED reciprocating and turbine generators serving Growth Outlook data centerand microgrid customers ~7.4x 2026E Adjusted EBITDA Accretive on a DCF per share and earnings per share basis Expected to close early Q2 2026 1 Excluding fees and purchase price adjustments 2 Anticipated at closing 3
Transaction Rationale PREMIUM 384 MW of state-of-the-art CAT-powered distributed generation equipment Generation Fleet Includes turbines and reciprocating engines, providing application flexibility SYNERGISTIC Kodiak has an industry-leading track record of operating large horsepower engines With Kodiak’s Current at the highest levels of performance and reliability Business Accelerate DPS’s growth and improve operating margins through leveraging Kodiak’s support infrastructure EXPANDS Access to high-growth end markets like data centers and potential to increase Customer Reach with business with existing & new customers in the energy industry Contracted Cash Flows Potential to increase the duration of Kodiak’s contracted cash flow DPS leadership team to join Kodiak, bringing decades of distributed power EXPERIENCED experience and key commercial relationships Management Team Existing multi-year data center primary power contract operating at 99.9% reliability, for nearly two years COMPELLING Accretive on an earnings and discretionary cash flow per share basis Valuation & Capital Attractive unlevered returns on organic capex Deployment Opportunity 4
Sources and Uses Transaction Sources & Uses (in millions)1 Sources Uses 3.5x – 4.0x Go-forward long-term ABL Facility $590 Cash to Sellers $575 leverage target Kodiak Stock $100 Kodiak Stock to Sellers $100 Purchase Price $675 >$800M Fees & Expenses $15 Pro forma availability on ABL facility3 Total Sources $690 Total Uses $690 Kodiak Pro Forma Leverage Profile2 Kodiak Standalone Kodiak + DPS 4.0x 3.8x 3.5x 3.5x – 4.0x Q3 2025 Preliminary YE 2025 Pro Forma Q1 2026 4 Long Term Target 1 Excludes working capital and any closing price adjustments 2 Represents leverage ratio as defined in the Company’s ABL Credit Agreement; uses last quarter annualized adjusted EBITDA 3 ABL availability calculated as Kodiak estimated Q1 2026 availability post draw at closing 5 4 Calculated as Kodiak estimated Q1 2026 total debt outstanding plus draw at closing divided by Kodiak plus DPS estimated Q1 2026 adjusted EBITDA (annualized)
DPS Has A Diversified Power Portfolio ~364 MW Under contract1 Contracted Power by Industry 12% Icon size represents % of contracted megawatts at the 21% location 67% Distributed Power Asset Footprint Data Center Microgrids Data Center Microgrids Manufacturing Manufacturing 1 Estimated as of March 31, 2026 Note: DPS is in the process of exiting Mexico upon the summer 2026 termination of an existing contract 6
Premium Fleet with Application Flexibility 100% Caterpillar Power Generation Fleet1 223 MW 161 MW Turbine Reciprocating Generators G enerators Power Solutions for Diverse End Markets Data Centers Manufacturing Microgrids DPS’s Proven Capabilities Impeccable Safety Rapid Deployment Creativ
e Solutions Turnkey Packages Record 1 Anticipated at closing 7 Operating Large Engine Fleets at the Highest Levels of Reliability is What We Do CAT 3516J Gas Compression Engine Compression & Genset Engine Similarities (1380 Horsepower) Engines Highly similar design and operation Parts & Components Highly similar Maintenance Profiles CAT 3516H Genset Engine Similar maintenance and overhaul processes (Powers 1.9 MW Genset) >700 Leading AI/ML KGS Caterpillar-certified Buyer of large HP KGS operational techs that can be Caterpillar recip engines AI/machine learning cross-trained on over last decade technology scalable generators1 across both platforms 1 As of January 20, 2026, over 700 Kodiak technicians completed at least 1 CAT Certification course 8
Step Change in U.S. Power Demand Growth U.S. Power Demand in Megawatts1 Power Demand Growth by Sector2 7% 5% Data Centers “America
must add at least 100GW of 628 Commercial 15% firm power in the next five years for Residential 58%
America to continue to lead the AI 15% Industrial Race and fuel
reindustrialization in Transport our country.” - Chris Wright United States Secretary of Energy 444 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 1 EIA Short Term Energy Outlook 2 Power Demand Growth from
2025-2035; Rystad Energy Research and Analysis, September 2025 9
Data Centers Require Onsite Power “Bring Your Own >6 Years > 60 Gigawatts Generation” Time it takes to add new power Projected Behind-the-Meter of power Emerging solution to growing gap generation to the PJM grid1 solutions needed by 20352 between data center power demand growth and supply additions U.S. Data Center Power Demand in Gigawatts2 Developers Expecting 100% Onsite Generation3 150 April ‘24 Nov. ‘25 By end of 100 year 2030 1% 33% 33x 50 0 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 By end of 12% 44% year 2035 High behind the Expecting grid Existing data meter potential connect center demand 3.7x 1 Enverus – “Unveiling ISO Dynamics and Market Trends for 2025” 2 Rystad Energy Research and Analysis, September 2025 10 3 Bloom Energy – 2026 Data Center Power Report
Permanent Microgrids in the Permian 8 Years 3-6 Years ~20% of the ERCOT Permian the time it takes to connect to time it takes to add new power demand queue got Basin 1 the grid in New Mexico WTX transmission lines2 connected to the grid in 20241 Permian Basin Power Demand in Gigawatts3 2025 – 2030 Demand Growth 2030 Supply Demand Microgrids / growth distributed power 3 16 7 Unmet demand from current 8 facilities 9 Current on-grid 5 2025 Demand from 2030 Unmet Demand Grid Connected Production Growth 1 Bloomberg and Kodiak Fundamentals Team 2 ERCOT’s Transmission Planning Process – December 2025 3 Rystad Energy Research as of September 2025 11
ENERGIZED Growth Outlook Distributed Power Accelerates Kodiak’s Growth Profile Significant Growth Potential Adjusted EBITDA DPS <5X Adj. EBITDA Creation Multiple on Power Generation Kodiak DPS Kodiak EBITDA Kodiak . Adj 2026 2030 12
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FAQ
What transaction did Kodiak Gas Services (KGS) announce in this 8-K?
How is the $675 million DPS acquisition by Kodiak Gas Services structured?
When is the Kodiak Gas Services acquisition of DPS expected to close?
What termination fee is associated with the Kodiak Gas Services–DPS purchase agreement?
How does the DPS acquisition affect Kodiak Gas Services’ leverage and liquidity?
Why does Kodiak Gas Services view DPS as a strategic fit?
Will Kodiak Gas Services issue new shares as part of the DPS acquisition?
