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Crescent Energy Acquires SilverBow in a $2.1 Billion All-Stock Transaction

  • May 16, 2024

 

SBOW Merger

Oil and gas producer Crescent Energy Company (CRGY) will acquire SilverBow Resources, Inc (SBOW) in a $2.1 billion deal, creating the second-largest operator in the Eagle Ford basin in Texas.

SilverBow and Crescent had last year bought the Eagle Ford assets from Chesapeake Energy (CHK) and Mesquite Energy, respectively.

Under the merger agreement, SilverBow shareholders will receive 3.125 shares of Crescent common stock for each share of SilverBow common stock, with the option to receive all or a portion of the proceeds in cash at a value of $38 per share, which represents a premium of 17.47% from the stock’s last close.

The shareholders can choose to go with the cash and stock elective of the merger for the maximum cash consideration of $400 million.

The combined company, which is expected to form by the end of the third quarter of 2024, is expected to produce roughly 250 million barrels of oil equivalent per day. SilverBow’s EV/EBITDA (TTM) ratio is 3.17, well below the sector median of 6.41.

Upon closing, the Crescent board will increase to 11 members with the addition of two directors from SilverBow. Crescent CEO David Rockecharlie will continue to serve as the Chief Executive Officer of the combined company.

SilverBow earlier this year, had rejected a buyout offer from largest shareholder Kimmeridge Energy Management, saying it “undervalued” the company.

For additional information about the merger, please visit the Deal Metrics page at: Deal Metrics for the acquisition of SilverBow Resources, Inc (SBOW) by Crescent Energy Company (CRGY)

Editor’s Note: Baranjot Kaur contributed to this article

Disclaimer: The information provided in this article should not be used as a basis for making any investment decisions. We recommend conducting thorough due diligence before buying or selling any securities mentioned in this article. We do not guarantee the accuracy or completeness of the data provided in this article.