Energy XXI to pay $1.53 billion for EPL Oil & Gasin a deal that will see it become the largest public oil and gas producer on the US Gulf of Mexico shelf.
March 12 (Reuters) – Energy XXI Ltd said it would buy EPL Oil & Gas Inc for $1.53 billion to become the largest public oil and gas producer on the U.S. Gulf of Mexico shelf.
Energy XXI is offering $39.00 per EPL share, a premium of about 34 percent over the stock's Tuesday close of $29.11 on the New York Stock Exchange.
Energy XXI said about 65 percent of the deal value will be paid in cash, while 35 percent will be paid in stock. The deal is valued at $2.3 billion including debt.
After the acquisition, Energy XXI will have production worth about 65,000 barrels of oil equivalent (boe) per day, 70 percent of which will be oil, the company said.
"EPL's assets and operations closely resemble our own, predominantly oil, with some of the highest margins in the industry," Energy XXI Chief Executive John Schiller said in a statement.
EPL owns working interests in 37 producing fields in the Gulf of Mexico and its properties are estimated to contain net proved and probable reserves of 106.3 million boe, about 71 percent of which is oil.
Energy XXI said it expects to have an enterprise value of about $6 billion upon completion of the deal.
EPL shares jumped 24 percent to $36.10 in trading before the bell on Wednesday. Energy XXI shares were unchanged from their Tuesday close of $23.37 on the Nasdaq.
Copyright 2016 Thomson Reuters. Click for Restrictions.
WHAT DO YOU THINK?
Click on the button below to add a comment.
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Most Popular Articles
From the Career Center
Jobs that may interest you