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https://ir.div.energy/news-events/us-press-releases/detail/203/diversified-energy-reports-strong-second-quarter-results-highlighting-consistent-cash-margins-year-over-year-growth-and-disciplined-execution-of-maverick-acquisition-integration
Monster in the making for a dividend play on natty gas. Data centers will need natty gas to power the transition.
$DECPF (Sharecast News) - Diversified Energy announced an agreement on Monday to acquire Maverick Natural Resources, a portfolio company of EIG, for $1.275bn.
The FTSE 250 company said the acquisition would enhance its asset base, production scale, and commodity mix, while supporting its long-term strategy of generating sustainable free cash flow and shareholder returns.
It said the deal would combine complementary asset packages, bringing together Diversified's low-decline, capital-efficient production with Maverick's liquids-rich assets.
The acquisition was expected to result in a 95% increase in revenue and a 55% rise in free cash flow, alongside improved margins and cost synergies.
It said the combined entity would have an enterprise value of around $3.8bn and produce approximately 1,200 million cubic feet equivalent per day, or about 200,000 barrels of oil equivalent per day.
$DECPF Diversified Energy to acquire natural gas properties from Crescent Pass
Diversified Energy Company announced the execution of a conditional purchase and sale agreement for the acquisition of high-working interest, operated natural gas properties and related facilities located within eastern Texas from Crescent Pass Energy. The Acquisition will be funded through a combination of the issuance of approximately 2.4 million new U.S. dollar-denominated ordinary shares direct to the Seller and a senior secured bank facility supported by the acquired assets, along with existing and expanded liquidity from the Company's recently increased borrowing capacity. The ordinary shares will be subject to a customary commercial lock-up agreement. The Company expects to close the Acquisition in the third quarter of 2024.
Acquisition Highlights: Purchase price of $106 million before anticipated, customary purchase price adjustments; Estimated Net Purchase Price of $100 million; Anticipated close during the third quarter of 2024; Net purchase price represents a PV-20 valuation; Current net production of 38 MMcfepd with low annual declines of ~9%; Complements industry-leading corporate declines and capital intensity; Significantly gas-weighted production with ~92% gas volumes; Attractively priced at $2,651 per flowing Mcfe; Provides opportunities for additional cost efficiencies; Estimated NTM EBITDA of ~$26 million representing a 3.8x purchase multiple; PDP Reserves of ~170 Bcfe with PV-10 of $155 million; Assets are contiguous with Diversified's existing East Texas assets; Proximity to existing assets creates immediate line of sight to future operating efficiencies; Includes ~170,000 acres of commercially attractive leasehold in both East Texas and the Freestone Trend.
$DECPF nat gas has been insanely cheap but that'll change in the coming years, exponential increase in electricity demand due to ai, EVs and crypto and a decrease in supply due to LNG terminals coming online in 2024 and 2025. Guess what that means for the price of natural gas?
$DECPF Diversified Energy announces completion of acquisition, credit facility upsize
Diversified Energy Company announces the closing of its acquisition of the proportionate working interest in certain assets within the Company's Central Region from Oaktree Capital Management, as announced on March 19, 2024. Concurrently, the Company also completed an acquisition-related redetermination of the borrowing base of its revolving credit facility resulting in a 26% or $80 million increase in the borrowing base to $385 million and estimated post-transaction liquidity of ~$130 million.
Acquisition Highlights Purchase price of $410 million before customary purchase price adjustments; Acquisition net purchase price of $377 million after customary purchase price adjustments; PDP reserves of 510 Bcfe and a PDP PV10 of ~$462 million; Current net production of 122 MMcfepd; Estimated 2024 Adjusted EBITDA of ~$126 million; Purchase price multiple of ~3.0x and ~PV17 valuation on PDP-only assets; Includes hedges on ~60% of the Assets 2024 production at an average price of ~$3.89/MMBtu; Consideration for the Acquisition consists of $83 million in deferred cash payments to Oaktree, the assumption of Oaktree's proportionate debt of ~$120 million associated with the ABS VI amortizing note and other expanded liquidity sources.
