Silver Run Acquisition II, a private equity backed oil and gas startup led by the former chief executive of Anadarko Petroleum Corp, has agreed to acquire two Oklahoma energy companies.
Silver Run, which raised $1.03 billion in an initial public offering in March, said in a statement it reached agreements with oil and gas producer Alta Mesa Holdings LP and Kingfisher Midstream LLC, a pipeline and gas gathering company. Terms of the deals were not disclosed.
James Hackett, the former head of Anadarko, will be executive chairman of the combined company, which will take the name Alta Mesa Resources. The deal is expected to close in the fourth quarter.
A spokesman for Alta Mesa was unavailable for comment on terms of the agreement. Silver Run said it expected the market value of the combined companies to be about $3.8 billion based on its projections of future earnings.
Energy investor Riverstone Holdings LLC earlier this year formed Silver Run as a special purpose acquisition company, or SPAC, an investment vehicle that raises money on the reputation of its managers and then goes hunting for a business to buy.
Riverstone quadrupled its investment in an earlier energy SPAC led by former EOG Resources CEO Mark Papa. That SPAC acquired Centennial Resource Development, a shale oil producer. Riverstone and Alta Mesa’s existing owners will hold about 34 percent of the combined company’s shares. Kingfisher’s existing owners also will own a significant portion of the new company’s shares, according to a statement by Hackett.
The company will operate in the central Oklahoma energy basin known as the Stack, a fast-growing and low cost area for oil and gas production.
Alta Mesa in May filed confidentially for an initial public offering of stock that was never completed. The Houston-based company reported a net loss of $167.9 million on revenue of $210.7 million last year.