Halcon Resources To Acquire GeoResources GEOI 04/25 06:30 AM
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HOUSTON--(BUSINESS WIRE)--April 25, 2012--
Halcon Resources Corporation ("Halcon Resources") and GeoResources, Inc. (GEOI:$36.55,00$5.78,0018.78%) ("GeoResources") today announced that they have entered into a definitive merger agreement in which GeoResources (GEOI:$36.55,00$5.78,0018.78%) will merge into a wholly- owned subsidiary of Halcon Resources in a cash and stock transaction that values GeoResources (GEOI:$36.55,00$5.78,0018.78%) at approximately $1.0 billion, based on the closing price of Halcon Resources common stock on April 24, 2012. Under the terms of the merger agreement, Halcon Resources will acquire all outstanding shares of GeoResources (GEOI:$36.55,00$5.78,0018.78%) common stock. GeoResources (GEOI:$36.55,00$5.78,0018.78%) stockholders will receive $20.00 in cash and 1.932 shares of Halcon Resources common stock for each share of GeoResources (GEOI:$36.55,00$5.78,0018.78%) common stock they hold, representing consideration to GeoResources (GEOI:$36.55,00$5.78,0018.78%) stockholders of $ 37.97 per share based on the closing price of Halcon Resources common stock on April 24, 2012.
Halcon Resources Corporation will continue to be led by Floyd C. Wilson, Halcon Resources' Chairman, President and Chief Executive Officer and Mark J. Mize, Executive Vice President, Chief Financial Officer and Treasurer. Upon completion of the merger, the stockholders of GeoResources (GEOI:$36.55,00$5.78,0018.78%) are expected to own approximately 18% of the combined company's outstanding shares on a fully diluted basis.
Floyd C. Wilson, Chairman, President and Chief Executive Officer of Halcon Resources commented, "This transaction represents a significant opportunity for the shareholders of both companies to benefit from the combined strengths of Halcon Resources and GeoResources (GEOI:$36.55,00$5.78,0018.78%) and is immediately accretive to discretionary cash flow, production and reserves on a per share basis. The combination will create a resource powerhouse with exposure to some of the most prolific unconventional liquids plays in the United States. The transaction will effectively increase our estimated proved reserves by over 150% to approximately 52.8 million barrels of oil equivalent, 69% of which is liquids, and substantially increase our average net daily production by over 170% to approximately 11,070 barrels of oil equivalent based on fourth quarter 2011 production rates. We look forward to creating a unified company that is uniquely qualified to create value from the significant upside potential intrinsic to both companies."
Frank A. Lodzinski, Chairman, President and Chief Executive Officer of GeoResources (GEOI:$36.55,00$5.78,0018.78%) stated, "We are excited about the opportunity to partner with a company that is well positioned to become a leading liquids-focused resource player. We have watched Floyd and his team create significant value for their shareholders over the years through their focused strategy, excellent technical capabilities and efficient operations. This transaction provides our shareholders with a combination of near-term liquidity and significant exposure to future upside. We believe our shareholders, employees and other stakeholders will prosper under the Halcon Resources banner and we are excited to move forward."
Terms and Conditions
Under the terms of the merger agreement, GeoResources (GEOI:$36.55,00$5.78,0018.78%) stockholders will receive $20.00 in cash and 1.932 shares of Halcon Resources common stock for each share of GeoResources (GEOI:$36.55,00$5.78,0018.78%) common stock that they hold. The transaction is expected to qualify as a tax-deferred reorganization under Section 368(a) of the Internal Revenue Code to the extent of the stock portion of the consideration received by GeoResources (GEOI:$36.55,00$5.78,0018.78%) stockholders.
The transaction is subject to the approval of the stockholders of both companies, as well as other customary approvals. The board of directors of each company has unanimously approved the merger agreement, which is subject to customary closing conditions, including approval of listing of the Halcon Resources shares to be issued in the merger on the New York Stock Exchange and regulatory clearance. The companies anticipate completing the transaction in the third quarter of 2012.
Barclays and Mitchell Energy Advisors acted as financial advisors to Halcon Resources and Wells Fargo Securities acted as financial advisor to GeoResources (GEOI:$36.55,00$5.78,0018.78%) .
Investor Conference Call
Halcon Resources and GeoResources (GEOI:$36.55,00$5.78,0018.78%) will host a joint conference call on April 25, 2012 to discuss the proposed transaction at 1:00 p.m. EDT (12:00 p.m. CDT). Investors may participate in the conference call via telephone by dialing (877) 810-3368 for domestic callers or (914) 495-8561 for international callers, in both cases using conference ID 74274125, and asking for the Halcon Resources/ GeoResources (GEOI:$36.55,00$5.78,0018.78%) call a few minutes prior to the start time. An accompanying slide presentation and a link to the live audio webcast will be available on Halcon Resources' website at http://www.halconresources.com on the day of the presentation.
About Halcon Resources
Halcon Resources Corporation is an independent energy company engaged in the acquisition, production, exploration and development of onshore oil and natural gas properties in the United States.
About GeoResources, Inc. (GEOI:$36.55,00$5.78,0018.78%)
GeoResources, Inc. (GEOI:$36.55,00$5.78,0018.78%) is an independent oil and gas company engaged in the development and acquisition of oil and gas reserves through an active and diversified program that includes the acquisition, drilling and development of undeveloped leases, purchases of reserves and exploration activities, currently focused in the Southwest, Gulf Coast, and the Williston Basin.
Geoi bought
Re: Geoi bought
another one bites the dust.
if i had held geoi i would be disappointed. seems like when one of the small outfits gets close to fair value it is time to bail. dan had fv at 40. it was recently just over 35.
if i had held geoi i would be disappointed. seems like when one of the small outfits gets close to fair value it is time to bail. dan had fv at 40. it was recently just over 35.
Re: Geoi bought
Halcón Resources will pay $20 in cash and a stock conversion of 1.932 of its shares for each share of GeoResources, valuing the company at $37.97 a share or a 23% premium to Monday's closing price.
You may want to hang on and take the HK stock.
The deal may drift up to my Fair Value estimate by the time it closes. HK has a lot of running room and a solid base.
You may want to hang on and take the HK stock.
The deal may drift up to my Fair Value estimate by the time it closes. HK has a lot of running room and a solid base.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group