"Oil and gas producers SM Energy and Civitas Resources will combine in a $12.8 billion merger of near equals that will expand SM as a major producer in the booming Permian Basin. The two Denver-based energy players said Nov. 3 they are combining forces as the oil and gas industry continues to consolidate, and the most prized assets are the needed inventory and scale to continue drilling wells for decades to come."
"William Blair, an energy analyst at the firm Neal Dingmann, said in a note: "While we think the Permian position has the ability to drive synergies and that there should be material debt refinancing gains, a merger like this with a lack of overlap across the remaining assets signals a continued need in the E&P (exploration and production) space for inventory anywhere it can be obtained.""
SM Energy and Civitas Resources are combining in a $12.8 billion all-stock merger to create a larger oil and gas producer with expanded Permian Basin presence. The combined company will concentrate assets across the Permian, Eagle Ford, Uinta and DJ basins, aiming to secure inventory and scale for decades of drilling. Civitas shareholders will own 52% of the merged firm while SM directors will hold six board seats and Civitas five. SM President and COO Beth McDonald will lead the company as SM CEO Herb Vogel retires in March. The deal reflects continued consolidation and valuation dynamics in the E&P sector.
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