U.S. shale producer %CrescentEnergy (NYSE: $CRGY) is buying smaller rival %VitalEnergy (NYSE: $VTLE) in an all-stock deal worth $3.1 billion U.S., including existing debt.
Vital shareholders will receive 1.9062 shares of Crescent common stock for each share held, representing a value of $18.95 U.S. per share and a premium of 20% over the stocks’ last closing price.
%Shale refers to oil that’s extracted from sedimentary rock using a hydraulic fracturing process.
Shares of Vital Energy climbed 7% higher on news of the acquisition, while the stock of Crescent Energy declined 8% in premarket trading on Aug. 25.
It had been previously reported that Crescent Energy was in advanced talks to acquire Vital Energy amid a growing wave of consolidation in the sector.
In the past week, %CenovusEnergy (NYSE: $CVE) announced that it is buying rival %MEGEnergy (TSX: $MEG) in a $7.9 billion U.S. cash-and-stock deal.
Once the deal is finalized, Crescent Energy shareholders will own 77% of the combined company while Vital shareholders will own the remaining 23%.
The deal is expected to close by the end of this year, subject to regulatory approval.
Prior to today (Aug. 25), CRGY stock had declined 33% this year to trade at $9.94 U.S. per share.
