Crescent Energy to acquireSilverBow Resources for $2.1B

Crescent Energy (CRGY) announced that they have entered into a definitive agreement pursuant to which Crescent will acquire SilverBow (SBOW) in a transaction valued at $2.1B. SilverBow shareholders will receive 3.125 shares of Crescent Class A common stock for each share of SilverBow common stock, with the option to elect to receive all or a portion of the proceeds in cash at a value of $38 per share, subject to possible pro ration with a maximum total cash consideration for the transaction of $400M. Under the terms of the agreement, SilverBow shareholders who elect to receive stock will receive 3.125 shares of Crescent Class A common stock for each share of SilverBow common stock. The transaction is structured as a cash-election merger with shareholders able to elect to receive $38 per share in cash up to a maximum total cash consideration of $400M. If aggregate cash elections by shareholders exceed the available cash election amount, shareholders electing cash only will receive a mix of cash and stock that limits the total transaction cash consideration to the available cash election amount. Pro forma for the transaction, Crescent shareholders will own between approximately 69% and 79% and SilverBow shareholders will own between approximately 21% and 31% of the combined company, on a fully diluted basis and dependent on the final cash consideration at closing. The combination has been unanimously approved by the boards of directors of both companies. A special committee of independent directors of Crescent have also unanimously approved the transaction. Current Crescent shareholders representing 43% of total Class A common stock and Class B common stock outstanding have entered into voting agreements in support of the transaction. The transaction, which will be subject to customary closing conditions, including approvals by shareholders of each company and typical regulatory agencies, is targeted to close by the end of the third quarter of this year. After close, the Crescent board of directors will increase to 11 members with the addition of two directors to be designated by SilverBow. John Goff will continue to serve as non-executive chairman and David Rockecharlie will continue to serve as CEO of the combined company. Crescent will remain headquartered in Houston.