Diversified will pay for the deal through a combination of about 2.34 million ordinary shares and cash consideration of $22 million. (Source: Shutterstock/ Diversified Energy)
Diversified Energy has closed its $68 million cash-and-stock bolt-on of East Texas natural gas assets, the company said on Oct. 30. Diversified said its net purchase price was $49 million after customary purchase price adjustments.
The acquisition, from a regional operator, adds the equivalent of 70 Bcf of proved developed producing with a PV-10 of $89 million. Diversified estimated next 12 month adjusted EBITDA of $19 million and said the purchase price multiple, gross, was 3.5x. Current net production is 21 MMcfe/d, or about 4,000 boe/d.
The deal, announced in August, is the second East Texas acquisition this year. The company previously closed a cash-and-stock deal of about 170,000 acres of leasehold in eastern Texas from Crescent Pass Energy.
"We are excited to announce the completion of another acquisition of high-quality, bolt-on assets within our Central Region, which are immediately accretive to operations, further increase operating scale and provide the opportunity for cost synergies,” Diversified CEO Rusty Hutson Jr. said in a press release. “We look forward to welcoming our new employees as Diversified leverages their experience for efficient integration, and the deployment of our Smarter Asset Management and sustainability initiatives across these assets."
Diversified will pay for the deal through a combination of about 2.34 million ordinary shares and cash consideration of $22 million. The cash will be drawn from a senior secured bank facility supported by the acquired assets and existing liquidity. The new shares represent approximately 4.57% of the company's existing issued share capital. The shares conveyed to the seller are subject to standard regulatory restrictions for a period of six months.
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