Chevron Corporation (NYSE:CVX) and Atlas Energy, Inc. (NYSE:ATLS) announced that Chevron would acquire Atlas Energy for cash of $3.2 billion and assumed pro forma net debt of approximately $1.1 billion.
Chevron (CVX), the second-largest U.S. oil and gas company, will pay US$43.34 per share, or a 37% premium to Atlas’ closing stock price on Monday.
Chevron (CVX) will also take over Atlas’s role as the operator of a joint venture in the Marcellus shale with Reliance Industries RELI.BO, which will continue to fund 75% of the operator’s drilling costs, up to US$1.4-billion.
Atlas’ average daily natural gas production is 118 million cubic feet equivalent.
Shares of Chevron were down 12 cents at US$84.68 in trading before the market opened.
Atlas is a leading producer in the Marcellus Shale in Pennsylvania, which has been the center of a lot of deal-making in the last year.
When the transaction closes, Chevron will gain Atlas Energy's estimated nine trillion cubic feet of natural gas resource, which includes approximately 850 billion cubic feet of proved natural gas reserves with approximately 80 million cubic feet of daily natural gas production.
Chevron is one of the world's leading integrated energy companies, with subsidiaries that conduct business worldwide. The company's success is driven by the ingenuity and commitment of its employees and their application of the most innovative technologies in the world. Chevron is involved in virtually every facet of the energy industry.
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Disclosure: "No Positions"