Here We Go: GeoResources Gets BuyOut Offer -- $20/Share Plus 1.9 Shares HK

Updates

August 5, 2012: HK acquired GEOI 2Q12; transcript;  recently discovered new NGL-rich field; earnings and operations update for 2Q12 here; 

Original Post 


Shares Jump 20%: That's Better Than AAPL's Jump! -- Just Saying

Mike Filloon's take on the buyout. 

Investors must like the deal: shares rose significantly today -- up about 20% in round numbers. For those who have been following the blog, I could be wrong, but I think GEOI was one of Filloon's favorites. I honestly can't remember, and too much is going on now to check. 

Link here.

Halcon Resources Corp said it would buy GeoResources Inc for about $973 million in a cash-and-stock deal, as CEO Floyd Wilson builds up the fledgling company's asset base as a prelude to an eventual sale.

GeoResources stockholders will receive $20 in cash and 1.932 Halcon shares, or $37.97, for each share they own. 

This is most interesting:

Wilson has made no secret that he plans to build a portfolio of liquids-rich assets before putting Halcon on the block a few years down the line.

Halcon, which trades under Petrohawk's ticker "HK", said it will divest some natural-gas weighted assets to raise additional cash to focus on core growth areas.

If this is "THE" Petrohawk of which I am familiar, this is most interesting. Did I read somewhere Petrohawk "discovered" the Eagle Ford. I can't remember; seems I read something along that line; will sort it out later.

Recent GEOI presentation:

http://www.georesourcesinc.com/PDF/CorporateProfile.pdf

I've not looked at the presentation yet. Don sent it to me; recommends looking at slides 8 - 10, 19 and 26. Noted that only 30% of GEOI production comes from the Bakken. Again, as Don says, these buyouts help put a value on these small energy companies.

Connecting some dots, a link to the Oil and Gas Journal, same story:

Floyd C. Wilson, Halcon Resources chairman, president, and chief executive officer, said the acquisition “will create a resource powerhouse with exposure to some of the most prolific unconventional liquids plays in the United States.”

The transaction will increase Halcon’s estimated proved reserves by more than 150% to 52.8 million boe, 69% of which is liquids, and boost its average net production by over 170% to 11,070 boe/d based on fourth quarter 2011 production rates.

Previously, Wilson was chief executive of Petrohawk Energy, which sold to BHP Billiton Ltd. for $12 billion last year.

Halcon Resources, a Tulsa independent, formerly was known as RAM Energy Resources.