Top Story | Private Equity | Capital Markets
Diversified Energy Co. Finalizes Sale of Undeveloped Haynesville Asset
Diversified Energy Company PLC has closed the sale of its undeveloped Haynesville acreage in Texas.
Diversified and Oaktree Capital Management divested their working interests in the acreage for a total cash consideration of approximately $67.4 million (net $34.6 million to Diversified) after closing price adjustments.
The sale of acreage represented approximately 1,700 net Mcf per day of production as of November, 2021, or just 2% of the production that Diversified originally acquired as part of the Tanos Energy Holdings III LLC deal in August 2021. Consistent with previous acquisitions, Diversified ascribed no value to the undeveloped Haynesville leasehold though this divestiture effectively reduces the Company's investment in the Assets Diversified acquired from Tanos by 29% to $83 million from the original $118 million(a), net of purchase price adjustments. The Company's sale of the Assets reflects its proven ability to purchase predominantly PDP (proved, developed, producing) assets at low multiples and drive further value through the strategic monetization of undeveloped upside potential and non-strategic assets.
Rusty Hutson, Jr., CEO of the Company, commented: "Monetizing a portion of the undeveloped Haynesville acreage we acquired in the Tanos transaction marks a strong finish to an exceptional year for Diversified and boosts our returns from that acquisition by reducing our purchase price by nearly 30%. Using the nearly $35 million of proceeds to reduce the borrowings on our revolving credit facility enhances our financial flexibility as we evaluate other value-accretive opportunities. We enter 2022 with momentum as we integrate our Central Region assets, progress our comprehensive ESG initiatives and remain ever focused on opportunities to expand our portfolio of producing assets."
Related Categories :
Deals - Deal Close
More Deals - Deal Close News
-
Ring Energy Finalizes Acquisition of Stronghold Energy II
-
Centennial, Colgate Finalize $3.9B Merger; Debut as Permian Resources Corp.
-
Diamondback Seals Rattler Midstream Deal; Takes Company Private
-
Riverbend Finalizes $1.8B Sale of Portfolio Companies
-
Northern Oil Closes $158MM Bolt-On Deal for Williston Assets
Ark-La-Tex News >>>
-
E&P Company Slash 2024 Capex & Frac Crews by 50%
-
What to Expect From Frac Activity in 2H'23 & 2024 -
-
Top Drilling Contractors Talk 2H '23 and 2024 -
-
Empire Petroleum First Quarter 2023 Results
-
Amplify Energy Corporation First Quarter 2023 Results -