Talos Energy Inc., a U.S.-based offshore oil and gas producer, has completed its previously announced acquisition of EnVen Energy Corporation ("EnVen").
Talos, which owns oilfields in both the U.S. side and the Mexican side of the Gulf of Mexico, first said in September 2022, that it would buy EnVen, a private operator in the deepwater U.S. Gulf of Mexico, for $1.1 billion.
Talos said at the time that consideration for the transaction would consists of 43.8 million Talos shares and $212.5 million in cash, plus the assumption of EnVen's net debt upon closing, estimated at the time at about $50.0 million at year-end 2022. Talos said that following the transaction, Talos shareholders would own approximately 66% of the pro forma company and EnVen's equity holders would own the remaining 34%.
The acquisition adds around 24 thousand barrels of oil equivalent per day ("MBoe/d") of production (>80% oil, >90% operated), to Talos, and increases production by 40% and gross acreage by 35%.
It also doubles Talos's operated deepwater facility footprint, adding key infrastructure in existing Talos operating areas.
Talos said in September that “EnVen operates numerous platforms, including five major deepwater facilities with significant open capacity and holds an acreage footprint of approximately 420,000 gross acres in core deepwater areas for future infrastructure-led development, exploitation and exploration opportunities.
Transaction completed
"The company expects to provide 2023 financial and operational guidance for the combined company to investors concurrently with the fourth quarter and full year 2022 earnings press release to be issued on Tuesday, February 28, 2023," Talos Energy said Monday, announcing the completion of the transaction.
After completing the acquisition Talos has approximately 126,370,000 shares of common stock outstanding and a market capitalization of approximately $2.5 billion, assuming the closing share price as of February 10, 2023.
Talos President and Chief Executive Officer Timothy S. Duncan commented: "We are excited to close the EnVen transaction, which adds significant scale and diversity to our business and integrate these high-margin, oil-weighted assets, operated infrastructure and overlapping acreage into our portfolio, strengthening our position as a safe, reliable, responsible operator in the Gulf of Mexico.
"The added scale and greater free cash flow generation ability also allows us to be even more competitive in our Carbon Capture & Sequestration business. I'm extremely proud of the Talos team for their strong focus and hard work and appreciate the continued support of the EnVen employees as we work together to ensure successful integration and realize the valuable synergies this transaction provides. We look forward to sharing our plans for the future in our upcoming earnings call."
The combined company is led by the senior management team of Talos. In addition, in connection with the closing of the acquisition and as previously announced, Robert Tichio, the Riverstone Holdings representative serving on Talos's Board of Directors, resigned from the Board of Directors, and Shandell Szabo and Richard Sherrill, two directors designated by EnVen, were appointed to the Board of Directors. The Board of Directors now consists of seven independent directors and Duncan.