Whiting to acquire Kodiak


Whiting Petroleum (WLL) will acquire Kodiak Oil & Gas (KOG) creating North Dakota's largest Bakken shale producer. During the first quarter, total combined output of the two companies was more than 107k barrels of oil per day from the Bakken/Three Forks formations.

The deal is valued at $6B, including $3.8B in stock and $2.2B in net debt, and is expected to close in Q4. Kodiak shareholders will receive 0.177 share of Whiting stock for each share of Kodiak common stock they own.

"It's going to allow our production at the combined company to grow faster than Whiting standalone did before," says Whiting CEO James Volker. "The combined company will have greater access to capital which will accelerate development of oil production."

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Comments (32)
  • Trader's Profit Compass
    , contributor
    Comments (2072) | Send Message
     
    no premium to current stock price??
    14 Jul 2014, 07:02 AM Reply Like
  • kb9778
    , contributor
    Comments (28) | Send Message
     
    If the Reuters article is correct, its a discount to market. Sounds more like a merger of interests than a buyout.
    14 Jul 2014, 07:19 AM Reply Like
  • PalmDesertRat
    , contributor
    Comments (3839) | Send Message
     
    The WSJ says the premium is 5% over Friday's close. In any event it sounds awfully small. Maybe KOG has some bad news coming in its 2Q earnings report.
    14 Jul 2014, 07:37 AM Reply Like
  • Mark Hayes
    , contributor
    Comments (32) | Send Message
     
    That's 5% over the AVERAGE stock price for last 2 months. 13.90 a share
    14 Jul 2014, 08:17 AM Reply Like
  • PalmDesertRat
    , contributor
    Comments (3839) | Send Message
     
    You're right, my bad. It's still a small premium.
    14 Jul 2014, 09:01 AM Reply Like
  • Trader's Profit Compass
    , contributor
    Comments (2072) | Send Message
     
    pretty disappointing if you ask me
    14 Jul 2014, 07:53 AM Reply Like
  • PalmDesertRat
    , contributor
    Comments (3839) | Send Message
     
    That depends-I own WLL so am happy to see a small premium. Provided it doesn't signal some other problems.
    14 Jul 2014, 08:12 AM Reply Like
  • ellaruth
    , contributor
    Comments (1090) | Send Message
     
    There are some persons who purchased Kodiak during the last crash for less than 25 cents. May I congratulate all of you for being so much smarter than I.
    I watched a $2 dollar secondary on Kodiak, after that it gradually melted down to
    below a 25 cents. I watched, all the while knowing that they had purchased a rig and were ready to accelerate.

     

    They will be another stock of similar value again, I think that I found it below a quarter also. I wont cry long.

     

    Nevertheless congratulations to all of you proven smart Kodiak shareholders.

     

    ER
    14 Jul 2014, 09:15 AM Reply Like
  • flyerguy1300
    , contributor
    Comments (1110) | Send Message
     
    .177/share?? Sounds like us shareholders get screwed over again... I don't like this merger!
    14 Jul 2014, 09:28 AM Reply Like
  • gavenner
    , contributor
    Comments (18) | Send Message
     
    Hope there is some synergism created in this deal, otherwise it looks like WLL wins.
    14 Jul 2014, 10:15 AM Reply Like
  • DGI_Dan
    , contributor
    Comments (88) | Send Message
     
    Something is fishy about this deal, why would any company accept a takeover deal for only 5% premium? maybe there is some issue about KOG that managment doesn't want to leak out to general population yet. With this merger, it becomes WLL's problem now (if theres one).
    14 Jul 2014, 10:20 AM Reply Like
  • phil2k
    , contributor
    Comments (72) | Send Message
     
    So should I be selling or holding my KOG after today's news? I'm up 22% in the name as of the time of writing.
    14 Jul 2014, 10:22 AM Reply Like
  • flyerguy1300
    , contributor
    Comments (1110) | Send Message
     
    I've sold mine.
    14 Jul 2014, 10:47 AM Reply Like
  • mmhudd
    , contributor
    Comments (18) | Send Message
     
    Without knowing more info, this does not make much sense.
    14 Jul 2014, 10:40 AM Reply Like
  • lol wut
    , contributor
    Comments (687) | Send Message
     
    Sounds like reality is beginning to kick in.
    14 Jul 2014, 10:47 AM Reply Like
  • ellaruth
    , contributor
    Comments (1090) | Send Message
     
    For most of the shareholders I would consider this closer to a take under as over a take over. The thing to watch is the assimilation of KOG's management into Whiting's management. What they will be paid, there bonus' and there options.
    I think this might turn out to be a grand takeover for KOG executives tendering their common and basically a delayed gratification for common shareholders who are non executives and non employees of KOG.

     

    Once again a few people in KOG probably have some subterranean sugar creek coming in from Whiting. Watch the Whiting fine print documents for at least two years.

     

    I certainly suspect something subethical but I am not saying anything is illegal.

     

    ER
    14 Jul 2014, 11:27 AM Reply Like
  • Seeking Bourbon
    , contributor
    Comments (145) | Send Message
     
    long since KOG was trading $4.20; sold today as the deal doesn't seem to benefit KOG holders....my opinion of course
    14 Jul 2014, 01:06 PM Reply Like
  • flyerguy1300
    , contributor
    Comments (1110) | Send Message
     
    I feel exactly the same as you. Sold my positions
    14 Jul 2014, 02:25 PM Reply Like
  • thebaker
    , contributor
    Comments (16) | Send Message
     
    I was late to KOG party in at 12 out at 15..
    14 Jul 2014, 01:12 PM Reply Like
  • lmagrish
    , contributor
    Comments (4) | Send Message
     
    I see it as a wash. I sense it will all depend on the next WLL report. Clearly it does not look to be a rich price and with the new drilling abilities...maybe it will prove to be a plus. I am long WLL....but have worried about the gas flare and transportation issue with the N.D. Production.
    14 Jul 2014, 01:41 PM Reply Like
  • lmagrish
    , contributor
    Comments (4) | Send Message
     
    I see it as a wash. I sense it will all depend on the next WLL report. Clearly it does not look to be a rich price and with the new drilling abilities...maybe it will prove to be a plus. I am long WLL....but have worried about the gas flare and transportation issue with the N.D. Production.
    14 Jul 2014, 01:41 PM Reply Like
  • PalmDesertRat
    , contributor
    Comments (3839) | Send Message
     
    WLL is up 7+% today. Apparently the market thinks they made a good deal.
    14 Jul 2014, 02:46 PM Reply Like
  • forfunandprofit
    , contributor
    Comments (12) | Send Message
     
    Calling it the way I heard it, my analysis of the conf call spin is that this deal is immediately accretive, but mostly because WLL brings financial leverage, expertise, better technology, better supplier agreements and scale to the party. All KOG brings is very attractive but heavily debt laden assets. Both sets of shareholders will benefit, but KOG was unable to negotiate preferential treatment for its shareholders over WLL’s. Even as a very long time KOG shareholder, I find this argument hard to refute as I listened to Peterson whole-heartedly agree that WLL's drilling/completion technology is superior.
    14 Jul 2014, 01:41 PM Reply Like
  • vacaron
    , contributor
    Comments (4) | Send Message
     
    You late buyers who paid over $14 a share won't be very happy.
    14 Jul 2014, 01:41 PM Reply Like
  • thebaker
    , contributor
    Comments (16) | Send Message
     
    http://on.mktw.net/1kW...

     

    FYI
    14 Jul 2014, 02:24 PM Reply Like
  • thebaker
    , contributor
    Comments (16) | Send Message
     
    http://bit.ly/1kWe2e3

     

    FYI KOG shareholders
    Law firm looking into the deal.
    14 Jul 2014, 02:24 PM Reply Like
  • PalmDesertRat
    , contributor
    Comments (3839) | Send Message
     
    those guys make their living suing companies for various things. I wouldn't read anything into their involvement.

     

    A good indicator would be if a competing, higher, offer came out. So far none has.
    14 Jul 2014, 05:09 PM Reply Like
  • Pablomike
    , contributor
    Comments (4866) | Send Message
     
    I made a prediction at 4am, can be verified, that the first class action would be filed at 1:30 pm. It looks like I missed by 12 minutes.
    14 Jul 2014, 08:01 PM Reply Like
  • Jack Banser
    , contributor
    Comments (560) | Send Message
     
    I would guess this deal is not as good as some of you expected because the 2.2B debt...
    14 Jul 2014, 04:56 PM Reply Like
  • danderson1
    , contributor
    Comment (1) | Send Message
     
    The real question is what will WLL be worth 2 years from now ?
    sell kog now or wait for synergies ?
    I bought at 8 but can be patient .what to do?
    14 Jul 2014, 05:21 PM Reply Like
  • kab1one
    , contributor
    Comments (3) | Send Message
     
    But if Whiting out performs KOG in the long term, KOG shareholders benefit. You need to examine this point. Already today, the value of the transaction has gone up because of Whiting, not KOG actions
    14 Jul 2014, 05:21 PM Reply Like
  • solojif
    , contributor
    Comments (133) | Send Message
     
    Lets face it KOG is not a WLL or CLR, or EOG. Its not 2010 when Stat oil paid way too much for Bringham. WLL got good acreage, and has the leverage to make it profitable. KOG sold out before they announced yet another quarter of poor results (no weather to blame this quarter). Who pays a high premium for a compnay that really isn't that profitable? (Please don't confuse production growth with profits). KOG has always been a very speculative "Trade", I think the traders are the one's who got the bad deal.
    Anyone have any thoughts on who may be next in the Bakken i.e Oasis,TPLM,HK
    14 Jul 2014, 05:28 PM Reply Like
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