Texas-based Denbury Resources will acquire Houston-based upstream energy company focused on the Eagle Ford Shale Penn Virginia in a deal valued at $1.7 billion, including the assumption of debt.
According to a press release, the deal is expected to close in the first quarter of 2019. Denbury stockholders will own about 71 percent of the combined company, and Penn Virginia shareholders will own the other 29 percent.
For each share of PVAC, Penn Virginia shareholders will receive a combination of 12.4 shares of Denbury common stock and $25.86 of cash, representing total consideration of $79.80 per share based on Denbury’s Oct. 26 closing price.
Penn Virginia shareholders will be able to receive all stock or all cash, as long as Denbury does not pay more than $400 million in cash combined.
Denbury plans to finance the deal with a combination of equity (issued to Penn Virginia shareholders), debt and cash on hand.
Chris Kendall, Denbury’s President and CEO, said: “Through this combination, we plan to focus Denbury’s significant enhanced oil recovery expertise on the prolific Eagle Ford shale, positioning us at the forefront of this exciting new arena for EOR. Denbury’s passion for improved oil recovery and our deep technical knowledge give us a strong advantage on this new frontier.”
AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week