SilverBow Resources Announces Eagle Ford Acquisition
August 13 2021 - 7:45AM
Business Wire
SilverBow Resources, Inc. (NYSE: SBOW) (“SilverBow” or “the
Company”) announced today it has entered into definitive agreements
to acquire oil and gas assets in the Eagle Ford (collectively, “the
Acquisition” or “the Transaction”) from an undisclosed seller.
Acquisition Highlights:
- All stock Transaction for approximately $33 million, consisting
of approximately 1.5 million shares of SilverBow common stock
- 45,000 total net acres in the Eagle Ford, bolstering
SilverBow’s gas position in McMullen and Live Oak counties, while
adding new oil positions in Atascosa, Lavaca, and Fayette
counties
- April 2021 net production of approximately 1,580 barrels of oil
equivalent per day, 39% liquids. Net oil production of 569 barrels
per day
MANAGEMENT COMMENTS
Sean Woolverton, SilverBow’s Chief Executive Officer, commented,
“We continue to execute on accretive opportunities and bolster our
balanced oil and gas portfolio. This marks the second acquisition
we have announced since the beginning of August. Our first deal
increased our high-return Eagle Ford and Austin Chalk locations, as
well as incremental working interest in producing wellbores, in our
La Mesa position. Today’s announcement expands our gas portfolio in
the Western Eagle Ford, while also adding oil acreage in three new
counties. Each transaction is accretive to Adjusted EBITDA and
further reduces our pro forma leverage ratio(1) via the assets’
incremental cash flow. Our ability to use stock as consideration
reflects the constructiveness of Eagle Ford partners to share in
SilverBow’s long-term value creation.”
TRANSACTION DETAILS
The Transaction has an effective date of June 1, 2021 and is
expected to close on or about October 1, 2021, subject to customary
closing conditions. The total purchase price for these Eagle Ford
assets is approximately $33 million, consisting of approximately
1.5 million shares of SilverBow common stock based on its 30-day
volume weighted average price as of July 7, 2021.
ABOUT SILVERBOW RESOURCES, INC.
SilverBow Resources, Inc. (NYSE: SBOW) is a Houston-based energy
company actively engaged in the exploration, development, and
production of oil and gas in the Eagle Ford Shale in South Texas.
With over 30 years of history operating in South Texas, the Company
possesses a significant understanding of regional reservoirs which
it leverages to assemble high quality drilling inventory while
continuously enhancing its operations to maximize returns on
capital invested. For more information, please visit www.sbow.com.
Information on the Company’s website is not part of this
release.
FORWARD-LOOKING STATEMENTS
This release includes “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
These forward-looking statements represent management's
expectations or beliefs concerning future events, including the
closing and expected benefits and IRR of the Transaction, and it is
possible that the results described in this release will not be
achieved. These forward-looking statements are based on current
expectations and assumptions and are subject to a number of risks
and uncertainties, many of which are beyond our control. Important
factors that could cause actual results to differ materially from
our expectations include, but are not limited to, risks and
uncertainties discussed in the Company’s reports filed with the
Securities and Exchange Commission. All forward-looking statements
speak only as of the date of this news release. You should not
place undue reliance on these forward-looking statements.
(Footnotes)
1 Accretion is based on Adjusted EBITDA for Leverage Ratio for
fiscal year 2021. Leverage ratio is defined as total long-term
debt, before unamortized discounts, divided by Adjusted EBITDA for
Leverage Ratio (a non-GAAP measure) for the trailing twelve-month
period. Adjusted EBITDA is calculated as net income (loss) plus
(less) depreciation, depletion and amortization, accretion of asset
retirement obligations, interest expense, impairment of oil and
natural gas properties, net losses (gains) on commodity derivative
contracts, amounts collected (paid) for commodity derivative
contracts held to settlement, income tax expense (benefit), and
share-based compensation expense. Adjusted EBITDA for Leverage
Ratio is calculated as Adjusted EBITDA plus amortization of
derivative contracts, in accordance with the covenant compliance
calculations under SilverBow's Credit Agreement. Neither Adjusted
EBITDA nor Adjusted EBITDA for Leverage Ratio should be considered
a replacement for the comparable GAAP measure.
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version on businesswire.com: https://www.businesswire.com/news/home/20210813005053/en/
Jeff Magids Director of Finance & Investor Relations (281)
874-2700, (888) 991-SBOW
SilverBow Resources (NYSE:SBOW)
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