Birmingham-based Diversified Energy is moving to acquire Oklahoma-based Canvas Energy for $550 million.
The deal adds to Diversified Energy’s existing holdings in Oklahoma, which will include 23 high quality wells that have been turned to sales in the last 12 months.
Diversified, formerly known as Diversified Oil & Gas, has holdings in oil and natural gas, as well as transport, marketing and well retirement.
Canvas Energy Inc. is a private oil and natural gas exploration and production company, headquartered in Oklahoma City. Its gross assets at the end of June amounted to $689 million. It reported revenue of $304 million for the previous 12 months.
It’s another big deal for the Birmingham company, which acquires existing, long-life assets such as wells and invests in them until they are retired.
Earlier this year, Diversified announced an agreement with global investment firm Carlyle to invest up to $2 billion in natural gas and oil assets across the U.S. That came after announcing an agreement to acquire Texas’ Maverick Natural Resources, creating a company with combined assets of about $3.8 billion.
The deal will bring Diversified’s holdings in central Oklahoma to a combined 1.6 million net acres.
CEO Rusty Hutson, Jr. said the acquisition strengthens the company by expanding its footprint with targeted assets.
“We are excited to leverage our strategic partnership with Carlyle for funding accretive acquisitions and are pleased with the collective team’s collaboration,” Hutson said.
“This initial transaction serves as an important milestone in our relationship and we look forward to growing our combined portfolio of high quality assets.”
If you purchase a product or register for an account through a link on our site, we may receive compensation. By using this site, you consent to our User Agreement and agree that your clicks, interactions, and personal information may be collected, recorded, and/or stored by us and social media and other third-party partners in accordance with our Privacy Policy.