STEP Energy Services raises $100 million in IPO, half of initial target

CALGARY – STEP Energy Services (TSX:STEP) says it has raised $100 million in an initial public offering, falling short of the $200 million target it set out earlier this year.

The offering illustrates how even with Canadian oil and gas services producers recovering from a two-year crude price crash, accessing capital markets can be a struggle.

Last month, Source Energy Services (TSX:SHLE) went public in the first major energy company IPO since October 2014, suggesting markets were thawing. But Source also scaled back its plans, closing a $175-million IPO after initially aiming to raise about $300 million.

STEP had hoped to sell its shares for between $14 and $16, according to its preliminary prospectus filed in February.

However, its adjusted prospectus filed last week set the price at $10 per share. The stock ended the session on Tuesday at $9.95.

Step offers a range of well completion services, while Source is one of the largest suppliers of speciality sand to Canada’s well fracking industry.