Bonanza Creek Energy, Inc. (NYSE: BCEI) rose following confirmation of a deal to purchase the company by SandRidge Energy, Inc. (NYSE: SD) valued at $36 per share in cash and stock.
The consideration consists of $19.20 in cash and $16.80 of SandRidge shares for each Bonanza Creek share.
SandRidge CEO James Bennett, said "This acquisition greatly enhances our existing portfolio by adding a deep inventory of drill-ready locations in the DJ Basin of Colorado and is highly complementary to our existing North Park, Northwest STACK and Mississippian assets. The geological and operational characteristics of Bonanza's Niobrara and Codell locations are analogous to our existing Colorado North Park assets, and we expect to benefit from the expertise of their teams.
Bonanza Creek Chairman Jack Vaughn said, "We are pleased to be able to accomplish this combination with SandRidge. This transaction represents an attractive opportunity for our shareholders to monetize a portion of their holdings through the cash consideration as well as to participate in the continued upside of the combined company. We believe our Niobrara and Codell assets and expertise will provide a strong complement to the SandRidge story and are excited to partner with SandRidge in growing the combined company."
The combined SandRidge-Bonanza Creek will operate over 630,000 net acres focused in the Rockies and Mid-Continent, producing approximately 55,000 Boepd.
Shares in Bonanza Creek got lift of $1.47, or 4.8%, to $32.13, while shares for SandRidge subsided $2.64, or 14.3%, to $15.79.
