US-based petroleum and natural gas company Chesapeake Energy has completed the previously announced $3.97bn acquisition of the WildHorse Resource Development, following shareholder approval.
Under the terms of the agreement signed last October, WildHorse common stockholders were offered to choose either 5.989 shares or a combination of 5.336 shares of Chesapeake common stock and $3 in cash, in exchange for tendering each share of WildHorse common stock.
Chesapeake Energy CEO Doug Lawler said: “In 2018, Chesapeake Energy continued to build upon our track record of consistent business delivery and transformational progress through both financial and operating improvements.
“The addition of the WildHorse assets to our high-quality, diverse portfolio, combined with our operating expertise and experience, provides another oil growth engine with significant oil inventory for years to come and gives us tremendous flexibility and optionality to help achieve our strategic goals.”
The transaction comprises WildHorse’s net debt of $930m and 420,000 net acres in the Eagle Ford Shale and Austin Chalk formations.
It will give Chesapeake strategic access to premium Gulf Coast markets and is expected to deliver estimated average annual savings between $200m and $280m over the first five years.
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By GlobalDataAccording to the transaction, WildHorse director David Hayes has joined the Chesapeake board.
As a result of the merger, Chesapeake shareholders now own 55% of the combined company, while WildHorse shareholders hold the remaining 45%.
