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Silver Run Acquisition Corp. II Schedules 6 February Stockholders Vote on Alta Mesa, Kingfisher Deals
Tuesday 23 January 2018

23 January 2018 - US-based energy-focused special purpose acquisition company Silver Run acquisition Corp. II (NASDAQ: SRUN) has set a record date of January 22, 2018 for and in advance of its special meeting of stockholders with respect to its proposed business combination with US-based exploration and production company Alta Mesa Holdings, LP and US-based midstream company Kingfisher Midstream, LLC, the company said.

The special meeting of stockholders will be held at 9:00 a.m., New York time, on February 6, 2018 at the offices of Latham and Watkins LLP, 885 3rd Avenue, New York, New York 10022.

Silver Run II expects the business combination to close on February 9, 2018, subject to the satisfaction of customary closing conditions, including the approval of the business combination by Silver Run II's stockholders at the special meeting.

Last August, Silver Run entered into definitive agreements to combine with Alta Mesa and Kingfisher Midstream.

Alta Mesa is an independent exploration and production company with assets located in the STACK play in Oklahoma. Kingfisher is a company engaged in the gathering, processing, and marketing of hydrocarbons in the STACK play.

Founded in 1987 by Michael E. Ellis and based in Houston, Texas, Alta Mesa is a pure-play exploration and production company focused on the prolific STACK play in the Anadarko Basin.

With approximately 120,000 contiguous net acres and about 4,200 gross identified drilling locations, Alta Mesa is among the largest and most active operators in the STACK.

Since 2012, Alta Mesa has drilled to total-depth 205 STACK horizontal wells, in order to further delineate and de-risk its approximate 300 square mile position in the up-dip oil window of the STACK.

To date, Alta Mesa has completed 173 of these wells, with 167 on production. Based upon production through 2Q17, Alta Mesa expects EURs at year end to exceed 650 MBOE per well or approximately 140 BOE per foot of lateral.

Kingfisher Midstream is a private midstream company with a leading position in the STACK play, with Alta Mesa serving as its anchor producer. Kingfisher's assets include over 300 miles of pipeline, 50 thousand barrels of crude storage capacity, and 60 MMcf/d of gas processing capacity with an additional 200 MMcf/d cryogenic plant expansion expected to commence operations in 4Q17.

With approximately 300,000 gross dedicated acres from Alta Mesa and five other third party customers, Kingfisher is uniquely positioned to capitalize on the increasing development activity in the STACK.

At consummation of the transaction, Silver Run II is expected to be renamed Alta Mesa Resources, Inc. and trade on the NASDAQ stock exchange under the ticker symbol "AMR."

James T. Hackett, chairman and chief executive officer of Silver Run II, will serve as Executive chairman following the consummation of the business combination, while Harlan H. Chappelle, Michael E. Ellis, and Michael A. McCabe will continue as chief executive officer, chief operating officer, and chief financial officer of Alta Mesa Resources, Inc., respectively.

Alta Mesa Resources will have an aggregate market capitalisation of approximately USD 3.8bn.

At USD 10 per share, the combined company would represent a valuation of 7.1x FV/2018E EBITDA. Alta Mesa would represent 6.1x FV/2018E EBITDA, and Kingfisher would represent 7.3x FV/2018E EBITDA. Riverstone and Alta Mesa management will collectively own a significant portion of the combined company, representing approximately 34% of the pro-forma market capitalisation.

The transaction is subject to the approval of Silver Run II stockholders and the satisfaction or waiver of other customary closing conditions, including the expiration or termination of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The transaction is expected to close in 4Q17.

Silver Run Acquisition Corp. II is an energy-focused special purpose acquisition company formed by Riverstone Holdings LLC for the purpose of entering into a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.

The company's strategy is to identify, acquire and, after its business combination, build a company in the energy industry that complements the experience of its management team and can benefit from their operational experience and expertise.

Citigroup acted as capital markets advisor to Silver Run II, Tudor, Pickering, Holt and Co. acted as financial advisor to Silver Run II, and Latham and Watkins LLP acted as its legal counsel.

Citigroup acted as sole financial advisor and lead capital markets advisor to Alta Mesa. Goldman Sachs and Morgan Stanley also acted as capital markets advisors to Alta Mesa. Haynes and Boone LLP acted as legal advisor to Alta Mesa.

JP Morgan served as lead financial advisor and Barclays acted as co-financial advisor to Kingfisher. Bracewell LLP acted as legal advisor to HPS Investment Partners and Kingfisher, Durham, Jones and Pinegar acted as legal advisor to ARM and Kirkland and Ellis LLP represented Bayou City Energy.
Details
Date Published: 23/01/2018
Target: Alta Mesa, Kingfisher Midstream
Country: USA
Deal Size: 3.8bn (USD)
Sector: Petroleum/Natural Gas/Coal
Type: Merger
Financing: Cash and Stock
Status: Agreed
Vendor:
Buyer: Silver Run Acquisition Corp. II
Buyer Advisor: Citigroup , Pickering, Holt and Co , Latham and Watkins
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