Alabama-based Diversified signed a definitive agreement to acquire Maverick, which is in the portfolio of energy and infrastructure investor EIG, for about $1.28 billion, including the assumption of debt, with payment in a mixture of cash and shares, according to a statement on Monday. The deal is expected to close during the first half of 2025 and includes a $50 million break fee payable in certain circumstances.
EIG will own about 20% of the outstanding ordinary shares in the combined entity, including shares currently owned from previous transactions.
The move comes just a week after Trump started his second term as president with a push to expand US oil and gas production. The country’s crude output is already at a record level, yet Trump declared an energy emergency that will allow him to wield sweeping Cold War-era powers to fast track fossil fuel projects even if it involves encroaching on habitats for endangered species.
Diversified, which specializes in buying old, minimally productive wells and keeping them in operation as long as possible, expects the combined company to have an enterprise value of about $3.8 billion and assets across Appalachia, the Western Anadarko, Permian, Barnett, and Ark-La-Tex regions.
“The combined footprint in Oklahoma and the Western Anadarko Basin creates one of the largest in terms of production and acreage, which includes the emerging Cherokee formation,” Diversified’s Chief Executive Officer Rusty Hutson Jr. said in the statement. The deal also provides a new Permian asset base with multiple zones in the Northern Delaware Basin, the company said.
Citigroup is serving as financial and transaction adviser to Diversified Energy, with Truist and Stifel as additional advisers. Jefferies Securities is serving as financial adviser to Maverick and EIG.
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