Canada's STEP Energy said to postpone IPO as oil prices fall

TORONTO (Bloomberg) -- Fracing service provider STEP Energy Services Ltd. postponed its planned initial public offering, according to people familiar with the matter, after oil prices fell making market conditions less favorable.

The Calgary-based company earlier on Tuesday lowered the price range for marketing its shares to C$10 to C$12 apiece from C$14 to C$16 each, the people said, asking not to be identified as the details are private. STEP had originally sought to raise about C$200 million ($148 million) in its IPO, according to a regulatory filing last month.

Shares were due to price after the market closed on Tuesday.

A representative for STEP didn’t immediately respond to requests for comment.

STEP’s listing would have been the largest IPO in Canada’s oil and gas sector since Seven Generations Energy Ltd. raised C$932 million in October 2014, according to data compiled by Bloomberg. STEP is backed by Canadian private equity firm Arc Financial Corp.

Canadian Imperial Bank of Commerce and Raymond James were leading the sale.

The offering was downsized after oil prices fell below $48/bbl as Saudi Arabia raised its production back above 10 MMbpd. STEP isn’t the only fracking supply company facing the reality of declining oil prices. Keane Group Inc., the year’s first fracking IPO, continues to trade below its offer price as well. The company debuted in January at $19 a share and has fallen 21% below the offer price.