Combined company to be the second largest
operator in the Eagle Ford
Creates leading mid-cap E&P with scaled,
balanced portfolio of high-quality assets
Substantial free cash flow generation with
disciplined capital allocation framework
Well-positioned for further growth through
accretive, returns-driven M&A
Crescent Energy Company (NYSE: CRGY) (“Crescent” or the
“Company”) and SilverBow Resources, Inc. (NYSE: SBOW)
(“SilverBow”), today announced that they have entered into a
definitive agreement pursuant to which Crescent will acquire
SilverBow in a transaction valued at $2.1 billion. The transaction
will create a scaled company with a balanced portfolio of
high-quality and long-life assets, an attractive, returns-driven
financial framework and strong balance sheet, led by a management
team and Board with significant operating and investing expertise
that is well-positioned to drive long-term growth and value
creation.
SilverBow shareholders will receive 3.125 shares of Crescent
Class A common stock for each share of SilverBow common stock, with
the option to elect to receive all or a portion of the proceeds in
cash at a value of $38 per share, subject to possible pro ration
with a maximum total cash consideration for the transaction of $400
million.
The Transaction Offers Compelling Value
for All Shareholders:
– High-Quality, Scaled and Complementary Asset Portfolio
– Complementary combination creates the 2nd largest operator in the
Eagle Ford with a broader portfolio of roughly 250 Mboe/d of
low-decline, long-life production and a deep, high-quality
inventory that supports compelling returns through cycles.
– Focus on Free Cash Flow and Disciplined Capital
Allocation – The combined company’s advantaged asset profile
generates substantial free cash flow governed by disciplined,
investor-first capital allocation, with a strong balance sheet and
peer leading return of capital framework, which includes a fixed
dividend and stock buyback program.
– Potential for Meaningful Cost Savings and Efficiencies
– Scaled enterprise advantages and complementary assets expected to
drive significant annual synergies of $65 to $100 million through
immediate cost of capital savings and operating efficiencies.
– Creates “Must-Own” Mid-Cap E&P Primed for Sustainable
Value Creation – The combined company will have the investing
and operating expertise, the balance sheet strength and the capital
markets access necessary to continue executing on Crescent’s proven
strategy of free cash flow and prudent growth through disciplined,
returns-driven M&A.
“This is a compelling transaction for shareholders of both
companies, creating a premier growth through acquisition platform,”
said John Goff, Crescent’s Chairman of the Board. “As Chairman and
a major long-term shareholder, it has been exciting to watch this
business execute on the strategy management laid out from the very
beginning. This combination further positions Crescent as a leading
growth business, and we look forward to welcoming the SilverBow
team as we continue to build this company.”
Crescent CEO David Rockecharlie said, “The combination with
SilverBow, which is expected to be immediately accretive to all key
per share metrics, solidifies Crescent as a leading operator in the
Eagle Ford and strengthens the company’s growth platform with
increased scale. The SilverBow team has built a complementary and
high-quality position in the Eagle Ford, and we believe the
combination offers a unique value proposition in our evolving
sector. The combined company will have an attractive and balanced
portfolio of stable, low-decline and highly cash-generative
production with a deep inventory of proven drilling locations,
well-positioned for flexible capital allocation through commodity
cycles. This combination creates a leading mid-cap company with
significant value creation potential and the stability of a
large-cap operator.”
SilverBow CEO Sean Woolverton added, “This is an exciting new
chapter for SilverBow and a compelling value proposition for our
shareholders. The transaction delivers an attractive premium to
SilverBow shareholders, with a choice to opt into the significant
upside, sustainable value and meaningful synergies that we see in
this combination by receiving Crescent shares -- or to receive
immediate cash liquidity. This transaction is consistent with our
commitment to pursuing any path that will maximize value for
shareholders and is the result of a review of alternatives
conducted with the assistance of our financial and legal advisors.
The SilverBow team built an incredible company, and today’s
exciting announcement is a testament to their hard work and
dedication. This combination of two strong companies positions the
pro forma business for continued success above and beyond what
either company could achieve on its own.”
Transaction Details
Under the terms of the agreement, SilverBow shareholders who
elect to receive stock will receive 3.125 shares of Crescent Class
A common stock for each share of SilverBow common stock. The
transaction is structured as a cash-election merger with
shareholders able to elect to receive $38 per share in cash up to a
maximum total cash consideration of $400 million (the “Available
Cash Election Amount”). If aggregate cash elections by shareholders
exceed the Available Cash Election Amount, shareholders electing
cash only will receive a mix of cash and stock that limits the
total transaction cash consideration to the Available Cash Election
Amount. Pro forma for the transaction, Crescent shareholders will
own between approximately 69% and 79% and SilverBow shareholders
will own between approximately 21% and 31% of the combined company,
on a fully diluted basis and dependent on the final cash
consideration at closing.
Timing and Approvals
The combination has been unanimously approved by the boards of
directors of both companies. A special committee of independent
directors of Crescent (the “Special Committee”) have also
unanimously approved the transaction. Current Crescent shareholders
representing ~43% of total Class A common stock and Class B common
stock outstanding have entered into voting agreements in support of
the transaction. The transaction, which will be subject to
customary closing conditions, including approvals by shareholders
of each company and typical regulatory agencies, is targeted to
close by the end of the third quarter of this year.
Governance
After close, the Crescent board of directors will increase to 11
members with the addition of 2 directors to be designated by
SilverBow. John Goff will continue to serve as Non-Executive
Chairman and David Rockecharlie will continue to serve as Chief
Executive Officer of the combined company. Crescent will remain
headquartered in Houston.
Advisors
Crescent’s financial advisors in connection with the acquisition
are Jefferies LLC, as lead advisor, and Wells Fargo. Crescent’s
counsel is Vinson & Elkins LLP. Wells Fargo Bank, NA has also
provided $2.0 billion of committed financing for the
transaction.
The Special Committee retained Intrepid Partners, LLC as
financial advisor and Richards, Layton & Finger LLP as
counsel.
SilverBow’s joint financial advisors are BofA Securities, Inc.
and Evercore and its counsel is Gibson, Dunn & Crutcher
LLP.
Conference Call Details
Crescent and SilverBow plan to host a joint conference call and
webcast at 7:30 a.m. Central Time / 8:30 a.m. Eastern Time on May
16, 2024. Complete details are below. A webcast replay and investor
presentation regarding the transaction can be found at
www.crescentenergyco.com and www.sbow.com.
Date: Thursday, May 16, 2024
Time: 7:30 a.m. CT (8:30 a.m. ET)
Conference Dial-In: 877-407-0989 / 201-389-0921 (Domestic /
International)
Webcast Link:
https://ir.crescentenergyco.com/events-presentations/
A replay of the webcast will be archived on the companies'
Investor Relations websites beginning 1 hour after the conference
call.
About Crescent Energy
Company
Crescent is a differentiated U.S. energy company committed to
delivering value for shareholders through a disciplined growth
through acquisition strategy and consistent return of capital.
Crescent’s portfolio of low-decline, cash-flow oriented assets
comprises both mid-cycle unconventional and conventional assets
with a long reserve life and deep inventory of high-return
development locations in the Eagle Ford and Uinta basins.
Crescent’s leadership is an experienced team of investment,
financial and industry professionals that combines proven
investment and operating expertise. For more than a decade,
Crescent and its predecessors have executed on a consistent
strategy focused on cash flow, risk management and returns. For
additional information, please visit www.crescentenergyco.com.
About SilverBow
Resources
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 and Austin Chalk
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.
No Offer or Solicitation
This communication relates to a proposed business combination
transaction (the “Transaction”) between Crescent Energy Company
(“Crescent”) and SilverBow Resources, Inc. (“SilverBow”). This
communication is for informational purposes only and does not
constitute an offer to sell or the solicitation of an offer to buy
any securities or a solicitation of any vote or approval, in any
jurisdiction, pursuant to the Transaction or otherwise, nor shall
there be any sale, issuance, exchange or transfer of the securities
referred to in this document in any jurisdiction in contravention
of applicable law. No offer of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
Important Additional Information About
the Transaction
In connection with the Transaction, Crescent will file with the
U.S. Securities and Exchange Commission (“SEC”) a registration
statement on Form S-4, that will include a joint proxy statement of
Crescent and SilverBow and a prospectus of Crescent. The
Transaction will be submitted to Crescent’s stockholders and
SilverBow’s stockholders for their consideration. Crescent and
SilverBow may also file other documents with the SEC regarding the
Transaction. The definitive joint proxy statement/prospectus will
be sent to the stockholders of Crescent and SilverBow. This
document is not a substitute for the registration statement and
joint proxy statement/prospectus that will be filed with the SEC or
any other documents that Crescent or SilverBow may file with the
SEC or send to stockholders of Crescent or SilverBow in connection
with the Transaction. INVESTORS AND SECURITY HOLDERS OF CRESCENT
AND SILVERBOW ARE URGED TO READ THE REGISTRATION STATEMENT AND THE
JOINT PROXY STATEMENT/PROSPECTUS REGARDING THE TRANSACTION WHEN IT
BECOMES AVAILABLE AND ALL OTHER RELEVANT DOCUMENTS THAT ARE FILED
OR WILL BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR
SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
TRANSACTION AND RELATED MATTERS.
Investors and security holders will be able to obtain free
copies of the registration statement and the joint proxy
statement/prospectus (when available) and all other documents filed
or that will be filed with the SEC by Crescent or SilverBow through
the website maintained by the SEC at http://www.sec.gov. Copies of
documents filed with the SEC by Crescent will be made available
free of charge on Crescent’s website at
https://ir.crescentenergyco.com, or by directing a request
to Investor Relations, Crescent Energy Company, 600 Travis Street,
Suite 7200, Houston, TX 77002, Tel. No. (713) 332-7001. Copies of
documents filed with the SEC by SilverBow will be made available
free of charge on SilverBow’s website at https://sbow.com
under the “Investor Relations” tab or by directing a request to
Investor Relations, SilverBow Resources, Inc., 920 Memorial City
Way, Suite 850, Houston, TX 77024, Tel. No. (281) 874-2700.
Participants in the Solicitation
Regarding the Transaction
Crescent, SilverBow and their respective directors and executive
officers may be deemed to be participants in the solicitation of
proxies in respect to the Transaction.
Information regarding Crescent’s directors and executive
officers is contained in the Crescent’s Annual Report on 10-K for
the year ended December 31, 2023 filed with the SEC on March 4,
2024. You can obtain a free copy of this document at the SEC’s
website at http://www.sec.gov or by accessing Crescent’s website at
https://ir.crescentenergyco.com. Information regarding
SilverBow’s executive officers and directors is contained in the
proxy statement for SilverBow’s 2024 Annual Meeting of Stockholders
filed with the SEC on April 9, 2024 (the “Definitive Proxy
Statement”). You can obtain a free copy of this document at the
SEC’s website at www.sec.gov or by accessing the SilverBow’s
website at https://sbow.com.
Investors may obtain additional information regarding the
interests of those persons and other persons who may be deemed
participants in the Transaction by reading the joint proxy
statement/prospectus regarding the Transaction when it becomes
available. You may obtain free copies of this document as described
above.
Important Additional Information About
the SilverBow Annual Meeting
SilverBow, its directors and certain of its executive officers
and employees are or will be participants in the solicitation of
proxies from shareholders in connection with SilverBow’s 2024
Annual Meeting. SilverBow has filed the Definitive Proxy Statement
with the SEC on April 9, 2024 in connection with the solicitation
of proxies for the 2024 Annual Meeting, together with a WHITE proxy
card.
The identity of the participants, their direct or indirect
interests, by security holdings or otherwise, and other information
relating to the participants are available in the Definitive Proxy
Statement (available here) in the section entitled “Security
Ownership of Board of Directors and Management” and Appendix F. To
the extent holdings of SilverBow’s securities by SilverBow’s
directors and executive officers changes from the information
included in this communication, such information will be reflected
on Statements of Change in Ownership on Forms 3, 4 or 5 filed with
the SEC. These documents are available free of charge as described
below.
SHAREHOLDERS ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT
AND ANY OTHER DOCUMENTS TO BE FILED BY SILVERBOW WITH THE SEC
CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN OR WILL
CONTAIN IMPORTANT INFORMATION. Shareholders are able to obtain,
free of charge, copies of all of the foregoing documents, any
amendments or supplements thereto at the SEC’s website
(http://www.sec.gov). Copies of the foregoing documents, any
amendments or supplements thereto are also available, free of
charge, at the “Investor Relations” section of SilverBow’s website
(https://www.sbow.com/investor-relations).
Forward-Looking Statements and
Cautionary Statements
The foregoing contains “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 fact, included in this communication
that address activities, events or developments that Crescent or
SilverBow expects, believes or anticipates will or may occur in the
future are forward-looking statements. Words such as “estimate,”
“project,” “predict,” “believe,” “expect,” “anticipate,”
“potential,” “create,” “intend,” “could,” “may,” “foresee,” “plan,”
“will,” “guidance,” “look,” “outlook,” “goal,” “future,” “assume,”
“forecast,” “build,” “focus,” “work,” “continue” or the negative of
such terms or other variations thereof and words and terms of
similar substance used in connection with any discussion of future
plans, actions, or events identify forward-looking statements.
However, the absence of these words does not mean that the
statements are not forward-looking. These forward-looking
statements include, but are not limited to, statements regarding
the Transaction, pro forma descriptions of the combined company and
its operations, integration and transition plans, synergies,
opportunities and anticipated future performance. There are a
number of risks and uncertainties that could cause actual results
to differ materially from the forward-looking statements included
in this communication. These include the expected timing and
likelihood of completion of the Transaction, including the timing,
receipt and terms and conditions of any required governmental and
regulatory approvals of the Transaction that could reduce
anticipated benefits or cause the parties to abandon the
Transaction, the ability to successfully integrate the businesses,
the occurrence of any event, change or other circumstances that
could give rise to the termination of the merger agreement, the
possibility that stockholders of Crescent may not approve the
issuance of new shares of common stock in the Transaction or that
stockholders of SilverBow may not approve the merger agreement, the
risk that the parties may not be able to satisfy the conditions to
the Transaction in a timely manner or at all, risks related to
disruption of management time from ongoing business operations due
to the Transaction, the risk that any announcements relating to the
Transaction could have adverse effects on the market price of
Crescent’s common stock or SilverBow’s common stock, the risk that
the Transaction and its announcement could have an adverse effect
on the ability of Crescent and SilverBow to retain customers and
retain and hire key personnel and maintain relationships with their
suppliers and customers and on their operating results and
businesses generally, the risk the pending Transaction could
distract management of both entities and they will incur
substantial costs, the risk that problems may arise in successfully
integrating the businesses of the companies, which may result in
the combined company not operating as effectively and efficiently
as expected, the risk that the combined company may be unable to
achieve synergies or it may take longer than expected to achieve
those synergies and other important factors that could cause actual
results to differ materially from those projected. All such factors
are difficult to predict and are beyond Crescent’s or SilverBow’s
control, including those detailed in Crescent’s annual reports on
Form 10-K, quarterly reports on Form 10-Q and current reports on
Form 8-K that are available on its website at
https://ir.crescentenergyco.com and on the SEC’s website at
http://www.sec.gov, and those detailed in SilverBow’s annual
reports on Form 10-K, quarterly reports on Form 10-Q and current
reports on Form 8-K that are available on SilverBow’s website at
https://sbow.com and on the SEC’s website at
http://www.sec.gov. All forward-looking statements are based on
assumptions that Crescent or SilverBow believe to be reasonable but
that may not prove to be accurate. Any forward-looking statement
speaks only as of the date on which such statement is made, and
Crescent and SilverBow 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. Readers are cautioned not to place undue reliance
on these forward-looking statements that speak only as of the date
hereof.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240516399077/en/
Crescent Energy Investor Relations Contacts
IR@crescentenergyco.com Crescent Energy Media Contacts
Media@crescentenergyco.com SilverBow Investor Relations
Contacts Jeff Magids Vice President of Finance & Investor
Relations (281) 874-2700, (888) 991-SBOW ir@sbow.com SilverBow
Media Contacts Adam Pollack / Jed Repko Joele Frank, Wilkinson
Brimmer Katcher (212) 355-4449
SilverBow Resources (NYSE:SBOW)
Historical Stock Chart
From May 2024 to Jun 2024
SilverBow Resources (NYSE:SBOW)
Historical Stock Chart
From Jun 2023 to Jun 2024
