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Resolute Sells More Midland Basin, Puts Off Reverse Split

Denver-based Resolute Energy Corp. agreed sell its Gardendale assets in the Midland Basin of West Texas to an undisclosed buyer for $177.5 million. Proceeds will reduce debt and fund development in the Delaware Basin and in the Aneth Field of southeast Utah, the company said.

The deal is expected to close around Dec. 22 with an effective date of Sept. 1, 2015.

"This transaction represents a continuation of our previously announced strategy to reduce debt and improve our liquidity and will allow us to focus on the development of our Permian Basin assets as well as our other properties," said CEO Nicholas Sutton. "Upon closing this transaction, we will have completed nearly $275 million of asset sales this year. We believe these transactions have positioned the company to accelerate development of the attractive opportunities in our property base.

"We continue to work on a number of other strategic initiatives, including the potential monetization of our Reeves County midstream infrastructure assets. We are also assessing the potential restructuring of our existing secured debt facilities in light of the numerous transactions recently announced by other companies in the industry."

In March Resolute announced a deal to sell Midland Basin assets for $42 million (see Shale DailyMarch 30).

The company also said Monday it has put off plans for a reverse stock split, previously announced to take place by year-end. Resolute said that according to the New York Stock Exchange, it has until its 2016 annual meeting to bring its share price back up to $1.00 to avoid an exchange delisting. If it can't boost the share price to that level, a reverse split will be pursued, it said.

Resolute shares closed at $1.00 on June 26 and have not closed above that level since. The stock was up more than 1% in early trading Tuesday at around 67 cents/share.

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