Shareholders Approve Santa Fe-Snyder Merger
The shareholders of Santa Fe Energy Resources and Snyder Oil
Corp. approved the merger of the two companies during special
meetings yesterday. More than 99% of the voting shareholders of
each company voted in favor of the merger. The new Houston-based
combined company, which will be called Santa Fe Snyder Corp., will
have a market capitalization of $1.6 billion, with reserves of 315
million boe. Combined production for 1999 is expected to be 105,000
boe/d, 55% of which will be gas and 70% of which will be produced
in the U.S.
"We are excited about the union of Santa Fe and Snyder and
believe that our enhanced strength will allow us to move quickly in
pursuit of global opportunities and domestic acquisitions that
enhance shareholder value," said CEO James L. Payne.
Based on combined three-year results through 1998, 270% of
production was replaced (75% from drilling) at a finding and
development cost of $4.97 per BOE. Over those three years, the
companies achieved an average of 14% annual production growth and
26% reserve growth.
Under terms of the merger, Snyder shareholders will receive 2.05
shares of Santa Fe common stock for each share of Snyder, resulting
in Santa Fe shareholders owning 60% and Snyder shareholders owning
40% percent of Santa Fe Snyder. The transaction will be accounted
for as a purchase and will be tax free to Snyder shareholders.
John C. Snyder, currently the chairman and CEO of Snyder will be
the chairman of Santa Fe Snyder. The eleven-person board will be
composed of five members from Snyder's current directors and the
existing six directors from Santa Fe.
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