The multibillion-dollar merger between LinnCo LLC and Berry Petroleum Co. may be defrosting after months of delays.

In early November, the companies announced revised terms of the proposed get-together: Berry's asking price increased to $4.9 billion, up about $600 million from $4.3 billion earlier.

As Kevin Smith, energy analyst for Raymond James put it, the drama is over.

“The Linn investment thesis has been highly de-risked,” Smith said. “Investors are now able to turn their attention to the pending LinnCo/Berry merger and the potential for a sizeable distribution increase in first-quarter 2014.”

The deal had been in limbo since an informal Securities and Exchange Commission (SEC) inquiry in July that centered on non-GAAP accounting used by Linn Energy LLC. The deal may have received additional scrutiny because it is believed to be the first acquisition of a public C-Corp by an upstream LLC or master limited partnership (MLP).

Since then, the price of Berry's stock has surged and the change in the terms of the merger likely reflects the increasing value.

Berry also had a strong third-quarter 2013, and management had indicated interest in assessing horizontal potential in the Midland Basin, where approximately 50% of its 60,000 net acres is in the fairway of the horizontal Wolfcamp play, according to Sterne Agee analysts.

The original terms of the deal suggested a 20% premium for BRY shareholders while the new price puts a 45% premium on Berry, based on pre-announcement levels, said David Tameron, senior analyst for Wells Fargo Securities.

“Today's announcement shows that both management teams remain enthusiastic about this merger and incentivized to get it done,” he said. “We believe the deal gets done.”

The companies extended the end date of the merger agreement to Jan. 31, 2014.

On November 1, Linn Energy and LinnCo reported that the SEC's Division of Corporation Finance advised that it has “no further comments” on amendments to the S-4.

In a joint statement, Mark E. Ellis, chairman, president and chief executive of Linn Energy, and Robert F. Heinemann, president and chief executive of Berry, said, “The boards and management teams of Linn and Berry remain committed to completing this merger. We continue to believe that, upon completion, this transaction will create tremendous

value for Linn Energy, LinnCo and Berry investors.”

Ellis said that Berry's operations have consistently outperformed expectations.

The proposed merger will create one of the largest independent oil and natural gas companies in North America with pro forma production of more than 1 billion cubic feet equivalent per day (Bcfe/d) and proved reserves of about 6.6 trillion cubic feet equivalent (Tcfe), of which 54% are liquids.

The stock-for-stock merger of Berry with LinnCo followed by the acquisition of the Berry assets by Linn Energy is expected to be tax-free to Berry shareholders.

Berry's long-life, low-decline, mature assets are attractive to Linn and will add presence in California, the Permian Basin, East Texas and the Rockies and an attractive new core area in the Uinta Basin.

Berry's probable and possible reserves are about 3.8 Tcfe. The company has about 2,850 producing wells and controls more than 200,000 net acres.

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