Whiting Petroleum To Buy Kodiak Oil & Gas In $6 Bln Deal

(RTTNews.com) – Independent oil and healthy gas association Whiting Petroleum Corp. ( WLL ) concluded Sunday to acquire smaller opposition Kodiak Oil Gas Corp. ( KOG ) in an all-stock understanding valued during $6.0 billion, including net debt of $2.2 billion. The understanding will emanate a largest Bakken shale and Three forks producer.

The deal, that has a unanimous capitulation of a play of directors of both companies, is approaching to tighten in a fourth entertain of 2014.

“We trust this transaction represents a poignant event for both Whiting and Kodiak shareholders to advantage from a strength of a total company. The further of Kodiak’s interrelated acreage position and estimable register of high lapse drilling locations will yield a event to expostulate poignant value expansion for both Whiting and Kodiak shareholders by an acceleration in drilling and boost in operational efficiencies,” Whiting’s Chairman, President and CEO James Volker pronounced in a statement.

The understanding between a dual Denver-based companies will emanate a widespread wanton writer in North Dakota’s Bakken shale of a U.S. Great Plains, with over 107,000 barrels of oil homogeneous per day of prolongation in a initial entertain of 2014, 855,000 total net acres and an register of 3,460 net destiny drilling locations.

The understanding will see Kodiak shareholders accept 0.177 of a share of Whiting share in sell for any share of Kodiak common batch they hold, representing a care of $13.90 per share, formed on a shutting cost of Whiting common batch of $78.54 on Friday.

However, a offer cost represents a 2.3 percent bonus over Kodiak’s shutting batch cost of $14.23 on Friday, though represents a reward of about 5.1 percent to a volume weighted normal cost of Kodiak for a final 60 trade days.

Whiting pronounced it has cumulative underwritten financing to boost a borrowing bottom to $4.5 billion with commitments totaling $3.5 billion. This volume is sufficient to yield for all stream drawings underneath Kodiak’s credit trickery and account a total company’s ongoing liquidity needs.

Following a closure of a deal, Whiting shareholders are approaching to possess about 71 percent of a total entity, while Kodiak shareholders are approaching to possess a remaining about 29 percent.

The execution of a understanding is essentially theme to a capitulation of both Whiting and Kodiak shareholders. However, a play of directors of both companies will suggest a shareholders to approve a deal.

The Whiting comparison government group will lead a total company, with Kodiak Chairman, President and CEO Lynn Peterson as good as Kodiak Co-Founder and Director James Catlin fasten a house of a total association during closing.

“We design that a transaction will be accretive to Whiting’s money upsurge per share, gain per share and prolongation per share for 2015 and increasingly accretive thereafter. Furthermore, a total association is approaching to have poignant financing flexibility, with a ratio of debt to 2014E EBITDA of approximately 1.6x. Additionally, we trust a all-stock transaction structure is credit enhancing,” Volker added.

WLL sealed Friday’s unchanging trade event during $78.54, down $1.42 or 1.78% on a volume of 1.05 million shares, and KOG sealed during $14.23, down $0.34 or 2.33% on a volume of 4.36 million shares.

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