PE Firm CCMP Capital Takes Stake In Chaparral Energy For $345MM

Acquired stake in company with interests in Permian, Midcontinent.

New York-based private-equity firm CCMP Capital Advisors LLC has invested $345 million to acquire a 37% ownership stake in privately held, Oklahoma City-based E&P Chaparral Energy Inc.

The Midcontinent and Permian producer has attempted unsuccessfully to find a merger partner on two occasions in the past year and a half.

"We are extremely pleased to be partnering with CCMP," says Mark Fischer, chairman and CEO of Chaparral. "With its extensive experience investing in leading energy companies, we believe CCMP is the ideal partner to take us to the next level. CCMP's exceptional operating resources will allow us to sustain our growth through a balanced program of acquisitions, exploitation, development and exploration."

In 2008, Chaparral attempted to acquire beleaguered Houston-based Edge Petroleum Corp. in a go-public attempt before being scuttled due to failing to secure financing. In another attempt to become a publicly traded company via reverse merger, Chaparral sought to combine with special-purpose acquisition company United Refining Energy Corp. (NYSE Amex: URX) for an implied $580-million value before shareholders of United Refining nixed the deal in December.

Founded in 1988, Chaparral focuses primarily on later-stage properties and using EOR techniques in the Midcontinent and the Permian Basin with other interests in East Texas, North Texas, the Gulf Coast and Rocky Mountains. As of June 30, 2009, Chaparral proved reserves were 146 million barrels of oil equivalent (62% oil). Its average daily production for first-half 2009 was 21,000 barrels of oil equivalent per day.

CCMP managing director Christopher Behrens says, "We are excited to have the opportunity to partner with an outstanding management team with a proven track record of success. Chaparral has a solid core asset base in regions with attractive unit economics."

Karl Kurz, CCMP managing director, adds, "Chaparral has a successful operating model and Mark Fischer has built a solid platform that we believe will enable the company to execute on a number of available growth opportunities."

Capital One Southcoast and Morgan Stanley werefinancial advisors to Chaparral. McAfee & Taft werelegal advisors. RBC Richardson Barr was financial advisor to CCMP and Latham & Watkins was legal advisor.