Berry Corporation (bry) Announces Entry into “Stalking Horse” Asset Purchase Agreement to Acquire California Assets of Basic Energy Services
August 17 2021 - 10:21AM
Berry Corporation (bry) (NASDAQ: BRY) (“bry” or the “Company”)
today announced that it has entered into an asset purchase
agreement (“APA”) as a “stalking horse” bidder to acquire
substantially all the assets comprising Basic Energy Services’
(“Basic”) California business lines in connection with Basic’s
bankruptcy proceeding filed today. Specifically, under the terms of
the APA, bry would acquire Basic’s well servicing, specialized
completion and remedial services, and water logistics services
businesses in California. Much of Basic’s California business today
is known as C&J Well Services and was originally established in
San Angelo, Texas, in 1948 by Frank Pool as Pool Well Services.
“This is a unique opportunity to expand our role
in California’s energy transition while growing bry’s business in a
way that enhances our current operations and contributes a
diversified revenue stream. This investment in profitable business
lines at an accretive valuation for our shareholders demonstrates
our commitment to grow opportunistically while endeavoring to be
the best operator and support the state’s high-priority
environmental goals. Having these capabilities in-house will also
enable us to optimize bry’s accelerated well plugging and
abandonment program, as well as our growing well workover efforts,
in keeping with our environmental commitments,” said Trem Smith,
bry’s board chair and CEO.
Smith continued, “We are excited to partner with
Jack Renshaw, an industry veteran with over 35 years’ experience
providing these services in California and Basic’s current senior
vice president of the Western Division, who will continue to lead
this business as a separate division from bry’s E&P operations.
With Jack’s leadership of the experienced workforce, we expect a
seamless transition with no interruption of best-in-class services
to their customers.”
“The California assets that bry is bidding on
represent only a portion of Basic’s business and our bid price for
these business lines is not a financially material investment for
bry. However, given the public nature of the bankruptcy process and
robust disclosures that are required, we wanted to inform bry’s
shareholders of the strategic merits of this deal to bry,”
concluded Smith.
The potential acquisition, if closed, would be
accretive to the existing bry portfolio, provide additional,
cost-effective in-house capabilities for well servicing, including
workovers and plugging and abandonment, and create a growth
opportunity through helping the state properly plug and
decommission the significant portfolio of orphan and idle wells in
California, estimated to be a $6 billion dollar market, as well as
the idle wells of other operators. Pursuant to the APA, Basic has
agreed to seek approval of bry as the “stalking horse” bidder for
these assets from the U.S. Bankruptcy Court for the Southern
District of Texas. The APA is subject to Court approval and any
higher or better offers pursuant to the bidding procedures and
deadlines approved by the Court. Bry intends to fund the $27
million purchase price with cash on hand upon completion of a
successful bid process.
About Berry Corporation
(bry)Bry is a publicly traded (NASDAQ: BRY) western United
States independent upstream energy company with a focus on the
conventional, long-lived oil reserves in the San Joaquin basin of
California. More information can be found at the Company’s website
at bry.com.
Forward-Looking StatementsThe
information in this press release includes forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of 1934. All
statements, other than statements of historical facts, included in
this press release that address plans, activities, events,
objectives, goals, strategies, or developments that the Company
expects, believes or anticipates will or may occur in the future.
The forward-looking statements in this press release are based upon
various assumptions, many of which are based, in turn, upon further
assumptions. Although we believe that these assumptions were
reasonable when made, these assumptions are inherently subject to
significant uncertainties and contingencies which are difficult or
impossible to predict and are beyond our control. Therefore, such
forward-looking statements involve significant risks and
uncertainties that could materially affect our expected results of
operations, liquidity, cash flows and business prospects, including
those risks described under the heading “Item 1A. Risk Factors” in
the Company’s Annual Report on Form 10-K for the year ended
December 31, 2020. You can typically identify forward-looking
statements by words such as aim, anticipate, achievable, believe,
budget, continue, could, effort, estimate, expect, forecast, goal,
guidance, intend, likely, may, might, objective, outlook, plan,
potential, predict, project, seek, should, target, will or would
and other similar words that reflect the prospective nature of
events or outcomes. Any forward-looking statement speaks only as of
the date on which such statement is made, and we undertake no
obligation to correct or update any forward-looking statement,
whether as a result of new information, future events or otherwise
except as required by applicable law. Investors are urged to
consider carefully the disclosure in our filings with the
Securities and Exchange Commission, available from us at via our
website or via the Investor Relations contact below, or from the
SEC’s website at www.sec.gov.
Contact
Todd Crabtree – Manager, Investor Relations
(661) 616-3811
ir@bry.com
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