What a f..g rip off!
Magnum Hunter puts up $138M for Appalachian plays
Magnum Hunter pays $138 million for 2 shale plays and expands footprint in Appalachian Basin
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Companies:
NGAS Resources, Inc.
PostRock Energy Corporation
Related Quotes
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NGAS 0.5261 +0.1406
Chart for NGAS Resources, Inc.
PSTR 3.91 +0.36
Chart for PostRock Energy Corporation
On Monday December 27, 2010, 11:14 am EST
HOUSTON (AP) -- Magnum Hunter Resources will spend nearly $148 million to expand its shale assets in Appalachia, the company said Monday.
The Houston oil and gas producer is buying NGAS Resources Inc. in an all-stock deal valued at $98 million. The combined company controls about 300,000 acres of "high-quality, long-lived proved developed producing assets," said Gary Evans, Magnum's chairman and CEO.
""We have been studying the possibility of a business combination with NGAS for most of 2010," Evans said.
In a separate deal, Magnum will acquire assets in West Virginia from PostRock Energy Corp. in a cash-and-stock deal valued at $39.75 million. That deal is expected to be completed by mid-January, and the NGAS acquisition is expected to be completed by March 31.
Under the NGAS agreement, each NGAS common share will be transferred to Magnum Hunter in exchange for the right to receive 0.0846 of a share of Magnum Hunter stock. The exchange ratio was based on a price of $6.50 per Magnum Hunter share. Boards of both companies already have approved the deal. NGAS, based in Canada, still must receive approval of two-thirds from its shareholders and the Supreme Court of British Columbia.
Magnum Hunter Resources Corp. said it would also issue about 6.6 million shares, about 8 percent of its outstanding shares, and it will open up a credit line of $120 million.
Company shares slipped about 1 percent Monday.
