Noble Energy set to buy Clayton Williams Energy for $2.7bn

Company - Mohit Shah - Jan 17,2017

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noble energy set to buy clayton williams energy for dollar 27bn


On Monday, oil manufacturer Noble Energy announced it would acquire Clayton Williams Energy for $2.7 billion managed in both cash and stocks.

The acquisition of Clayton Williams Energy by Nobel Energy is part of a plan to expand its presence in the top U.S. oil field, the Permian Basin.

Noble Energy revealed that the deal includes 71,000 net acres in the heart of the Southern Delaware Basin in Reeves as well as Ward counties in Texas, which form a part of the larger Permian Basin.

The Permian basin has seen a bunch of land acquisitions as producers struggle to gain or expand their positions in the oil field, where the cost of drilling is low.

David L. Stover, Noble Energy's Chairman, President and CEO commented, the company has been disciplined in assessing expansion opportunities in the Delaware Basin and are satisfied to have reached this deal with Clayton Williams Energy.

 He further added the transaction brings all the prime elements such as excellent rock quality and robust midstream opportunities boosting the Delaware Basin as a long-term growth source for Noble Energy. 

Chairman and CEO of Clayton Williams Energy, Clayton W. Williams, Jr. stated, “I am pleased that Noble Energy will be leading the development of our properties going forward”. 

According to the deal, Clayton Williams shareholders would be receiving 2.7874 shares of Noble Energy common stock along with $34.75 in cash for every share of common stock held.

Based on Noble Energy's closing stock price as of Jan. 13, the value of the transaction is about $139 per Clayton Williams Energy share, which is $3.2 billion in aggregate. It also includes the net debt assumed to be about $500 million, as per the company.