Diversified Energy has signed a definitive agreement to acquire Maverick Natural Resources, owned by energy investor EIG, for approximately $1.27bn to expand its asset base, density and commodity mix.
The transaction integrates investment-grade asset-backed securities (ABS) notes and enhances trading liquidity and capital market access, supporting business financing and potential acquisitions.
The deal aligns with Diversified’s strategy to maintain multiple development opportunities through joint ventures, expanding its footprint across high-return basins.
The acquisition offsets Diversified’s Western Anadarko position in the Cherokee Play and introduces a new Permian asset base in the Northern Delaware Basin.
With an enterprise value of around $3.8bn, the merged company will operate across five regions, producing approximately 1.2 billion cubic feet per day (bcf/d) of natural gas equivalent.
Diversified currently produces around 850 million cubic feet per day (mcf/d), with a commodity mix of 85% natural gas and 15% liquids. Maverick contributes an additional 350mcf/d, with a more balanced mix of 45% natural gas and 55% liquids.
The combined revenue, including settled hedges, is estimated at $940m for Diversified and $900m for Maverick, with respective adjusted EBITDA (earnings before interest, taxes, depreciation and amortisation) of $555m and $380m.
The combined company’s revenue is around $1.8bn, with $345m in free cash flow.
The gross acquisition value includes the assumption of $700m of Maverick’s debt, the issuance of 21.2 million new US dollar-denominated Diversified ordinary shares and approximately $207m in cash.
EIG will own around 20% of Diversified’s ordinary shares post-acquisition.
Diversified has secured commitments for a $900m credit facility, part of a $1.5bn arrangement, to fund the acquisition and refinance Maverick’s debt. The company may also refinance other credit products outside of this facility.
The acquisition, subject to a $50m break fee under certain conditions, has been approved by the board and is expected to close in the first half of 2025. Post-acquisition, the board will consist of eight directors, with six from Diversified’s current board.
Diversified CEO Rusty Hutson, Jr. said: “This acquisition expands our unique and highly focused energy production company with a complementary portfolio of attractive, high-quality assets. We have a proven track record of unlocking value from acquisitions while maintaining our commitment to sustainability leadership, and this acquisition provides us with great assets and employees that complement this strategy.
“The acquired producing assets have demonstrated leading well performance and are a natural fit with our operating advantage and existing acreage. Notably, 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.”
Citi, Truist and Stifel are advising Diversified, with Gibson, Dunn & Crutcher and Latham & Watkins (London) as legal advisors. KeyBanc is handling the debt financing, while Jefferies Securities and Kirkland & Ellis are advising Maverick and EIG.
Earlier this month, the company acquired natural gas properties in Virginia, West Virginia and Alabama within the company’s existing southern Appalachia operations from Summit Natural Resources.
