Citizen Energy to buy SCOOP/STACK E&P for $1B

By Roan Resources | October 01, 2019

Roan Resources Inc. has announced that it has entered into a definitive merger agreement to be acquired by Citizen Energy Operating LLC, an affiliate of Warburg Pincus LLC, in an all-cash transaction valued at approximately $1.0 billion, including Roan’s funded net debt of approximately $780 million as of September 30, 2019. The transaction is expected to be completed during the fourth quarter of 2019 or the first quarter of 2020, subject to Roan stockholder approval, regulatory approvals and the satisfaction of other customary closing conditions.

Roan is an independent oil and natural gas company headquartered in Oklahoma City, OK focused on the development, exploration and acquisition of unconventional oil and natural gas reserves in the Merge, SCOOP and STACK plays of the Anadarko Basin in Oklahoma. 

Under the terms of the merger agreement, which has been unanimously approved by Roan’s Board of Directors, Roan stockholders will receive $1.52 in cash for each share of Roan common stock they own. The all-cash purchase price represents a premium of approximately 24 percent over the closing price of company shares as of September 30, 2019.

“We are pleased to reach this agreement with Citizen Energy,” said Joseph A. Mills, Roan’s executive chairman of the board. “This transaction is the culmination of our board’s extensive review of strategic alternatives to maximize value for our stockholders, including a comprehensive process during which we engaged with a considerable number of counterparties. Ultimately, the board unanimously determined that an all-cash transaction with Citizen Energy is in the best interests of our stockholders and the company and will deliver value to our stockholders at a premium to our recent share price.”

Roan has also elected to temporarily reduce its drilling and development activity and to suspend all completion activity. Fully committed debt financing for the transaction will be provided by JPMorgan Chase Bank, N.A., BMO Harris Bank N.A., The Toronto Dominion Bank, New York Branch and BofA Merrill Lynch. Equity financing will be provided by investment funds affiliated with Warburg Pincus and Citizen Energy.