December 12, 2017: my thoughts on this deal.
December 12, 2017: Oasis will issue 32 million shares of common stock to raise $300 million to help pay for this $50,000/acreage in the Permian. Investors appear to be thrilled: shares are down about 6% in pre-market trading on this announcement. Some are saying:
- with a lot of North Dakota acreage selling for less than $100/acre, Oasis could have bought a lot of Bakken acreage for one billion dollars
- that the term "non-core" is being used very, very loosely
Oasis Petroleum Inc. today announced it has entered into a definitive purchase and sale agreement with Forge Energy, LLC to acquire 20,300 net acres in the Delaware Basin for approximately $946 million, consisting of approximately $483 million in cash and 46 million shares of the Company's common stock valued at approximately $463 million as of the close of trading on December 8, 2017.I've not downloaded the slides yet, but a reader says Oasis already has a slide presentation on this at this link (a pdf): https://www.oasispetroleum.com/wp-content/uploads/2017/12/2017.12_OAS-MA-presentation_vF.pdf.
The Acquisition will be funded through a combination of the OAS Shares issued to the Seller, a draw on the Company's revolving credit facility, and/or capital markets transactions, depending on market conditions. Additionally, Oasis expects to divest non-core Williston Basin acreage up to $500 million in 2018.