Delta Petroleum To Sell 37.5% Interest In Piceance Basin Assets For $400MM
CANCELLED: To purchase 37.5% WI in Vega assets in CO Piceance Basin.
Denver-based Opon International LLC plans to acquire a 37.5% nonoperated working interest in the Colorado Piceance Basin from Delta Petroleum Corp., Denver, (Nasdaq: DPTR) for $400 million.
The transaction involves a joint-venture agreement to develop Delta's Vega area assets, in which Delta will be operator.
Delta plans to apply $225 million of the consideration for the development of the Vega Area over the next three years, and the remainder to pay debt and for general purposes.
Delta has also agreed to issue to Opon warrants to purchase 13.3 million shares of Delta common stock at $1.50 per share and 5.7 million shares at $3.50 per share.
Closing is expected by June 1.
Morgan Stanley and Evercore Partners are financial advisors to Delta. Davis Graham & Stubbs LLP is legal advisor. Deutsche Bank Securities Inc. is financial advisor to Opon and Hogan & Hartson LLP is legal advisor.
In November, Delta announced it would seek strategic alternatives for its assets.