Ring Energy, Inc. Signs Purchase and Sale Agreement with Wholly Owned Subsidiary of The Carlyle Group L.P.
December 20 2018 - 4:05PM
Business Wire
Company Acquires Premium Acreage in Andrews
County
Ring Energy, Inc. (NYSE American: REI) (“Company”) (“Ring”)
announced today that it has entered into a Purchase and Sale
Agreement with Tessara Petroleum Resources, a wholly owned
subsidiary of The Carlyle Group L.P. (NASDAQ: CG) (“Carlyle”), to
acquire assets located in Andrews County, Texas for 2,623,948
shares of common stock of the Company valued at $5.80 per share.
The closing date of the transaction will be prior to year-end 2018,
with an effective date of November 1, 2018.
The assets consist of 4,763 net acres. Ring will be the
operator, have a 100% working interest and 75% net revenue
interest. The acreage is in, around and contiguous to the Company’s
core assets on the Central Basin Platform (“CBP”) and offsets the
majority of the Company’s top producing wells. Management estimates
that this acquisition, in combination with additional smaller
surrounding leases the Company has acquired, will add 5,313 net
acres and 55 new gross horizontal drilling locations.
A spokesperson for Carlyle commented, “We are pleased to enter
into this transaction with Ring Energy and its management team. We
have chosen to receive consideration in the form of stock as we
believe Ring is a best-in-class operator and the assets being
transferred are synergistic with Ring’s existing properties that
lie just across the lease line. We are fortunate to have found a
partner that we admire and trust and look forward to seeing Ring
increase its scale and value over time.”
Mr. Kelly Hoffman, CEO of Ring stated, “We have continued to
look for acquisitions that will complement our existing properties
and be immediately accretive. We have been working on acquiring the
Carlyle property for over six months. This acquisition lies within
the sweet spot of our core CBP operations. This, along with the
additional leases we have acquired, based on the one-rig drilling
program previously announced, adds over two years of new drilling
locations to our current inventory. These additional locations
could potentially add as much as $180 million of PV-10 value, or
approximately $2.85 per share, at a realized price of $45 per BOE
even after the issuance of the transaction shares.”
SunTrust Robinson Humphrey acted as financial advisor to
Ring.
About Ring Energy, Inc.
Ring Energy, Inc. is an oil and gas exploration, development and
production company with current operations in Texas.
www.ringenergy.com
Safe Harbor Statement
This release contains forward-looking statements within the
meaning of the “safe-harbor” provisions of the Private Securities
Litigation Reform Act of 1995 that involve a wide variety of risks
and uncertainties, including, without limitations, statements with
respect to the Company’s strategy and prospects. Such statements
are subject to certain risks and uncertainties which are disclosed
in the Company’s reports filed with the SEC, including its Form
10-K for the fiscal year ended December 31, 2017, its Form 10-Q for
the quarter ended September 30, 2018 and its other filings with the
SEC. Readers and investors are cautioned that the Company’s actual
results may differ materially from those described in the
forward-looking statements due to a number of factors, including,
but not limited to, the Company’s ability to acquire productive oil
and/or gas properties or to successfully drill and complete oil
and/or gas wells on such properties, general economic conditions
both domestically and abroad, and the conduct of business by the
Company, and other factors that may be more fully described in
additional documents set forth by the Company.
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version on businesswire.com: https://www.businesswire.com/news/home/20181220005877/en/
For further information contact:Bill Parsons, K M Financial,
Inc. (702) 489-4447
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