A deal between two energy companies has been finalized and just created what they’re calling the largest unconventional shale producer in the Permian Basin of West Texas and Eastern New Mexico.
Concho Resources Inc. in Midland, Texas has finished its acquisition of RSP Permian, Inc. in an all-stock deal valued at $9.5 billion . Under the merger deal, each share of RSP common stock was converted into the right to receive 0.320 shares of Concho common stock.
As a result, Concho expects to issue nearly 51 million shares of common stock in connection with the merger. Also, RSP common stock will no longer be listed for trading on the New York Stock Exchange.
The deal expands Concho’s strategic portfolio in the Permian Basin to nearly 640,000 net acres. The combined company will also run the largest drilling program in the basin with 27 rigs. The company also anticipates more than $60 million in corporate level savings.
In connection with the closing of the transaction, Concho announced the appointment of Steve Gray, formerly Chief Executive Officer of RSP, to the Company’s Board of Directors.
Tim Leach, Chairman and Chief Executive Officer of Concho, commented, “We are excited to complete this transaction and welcome the RSP team to Concho. By combining two great companies focused on the highest quality resources in the Permian Basin, we are creating a compelling enterprise with the scale and technical expertise necessary to compete globally. ”
