Pure Resources to Acquire Hallwood Energy for $268 M
Spring is not the only thing currently in the air, as merger and acquisition activity continues at the rapid pace set during 2000. Midland, TX-based Pure Resources Inc. and Denver, CO-based Hallwood Energy Corp. announced they have signed a definitive merger agreement in which subsidiary Pure Resources II will acquire all of the outstanding shares of Hallwood common stock at a price of $12.50/share.
"This acquisition will expand our core areas in the Permian and San Juan Basins and in South Texas," said Jack Hightower, CEO of Pure Resources. "It will also increase our already strong project inventory and enhance Pure Resource's ability to grow production through exploitation and exploration. We expect the transaction to be immediately accretive to earnings and cash flow per share. Hallwood is a highly regarded company and is a great strategic fit with our goal of growing our North American natural gas business."
Pure Resources placed the total consideration for the transaction at approximately $268 million, including assumed debt. Both boards of directors have already unanimously approved the deal. The merger is subject to numerous conditions, including the receipt of a majority of Hallwood's outstanding common and preferred stock.
Bill Guzzetti, President of Hallwood, said "Pure Resources' offer will provide our stockholders with a premium cash value and immediate liquidity for their holdings at prices well in excess of the highest levels at which either the common or the preferred stock has traded. We feel that the offer reflects the proven and potential value of Hallwood."
Pure Resources is an independent oil and gas exploration and production company operating in the Permian Basin, the San Juan Basin, the Gulf Coast and the Gulf of Mexico. Hallwood, a public oil and gas company, is primarily involved in the Permian Basin, the San Juan Basin, South Texas and onshore South Louisiana.
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