Crescent Energy to buy Devon Energy’s Eagle Ford assets in $4.2B deal

Crescent Energy (CRGY) fell 2.4% pre-market Thursday after saying it agreed to acquire Eagle Ford assets from Devon Energy (DVN) for ~$4.2B in cash, adding Tier 1 inventory and meaningful scale directly adjacent to its existing Eagle Ford operations.

The acquired assets consist of ~90K net acres in Karnes, DeWitt, and Gonzales Counties, Texas, representing 68K boe/day of net production, or ~4% of Devon's (DVN) total boe production, and more than 600 Tier 1 net locations.

To help fund the deal, Crescent (CRGY) said it launched a public offering of $1B of common stock with an underwriters option to buy up to an additional $150M of shares.

"The transaction solidifies Crescent's world-class Eagle Ford position and creates significant additional value creation opportunities through our proven operating strategy," Crescent Energy (CRGY) CEO David Rockecharlie said.

For Devon (DVN), the divestment follows pressure from activist investors to streamline its portfolio and focus on its core ​Permian Basin operations after its $58B merger with Coterra Energy.

"This sale is a direct outcome of our ongoing portfolio review, and it sharpens our focus on the highest-return, longest-duration assets," Devon Energy (DVN) President and CEO Clay Gaspar said. "Selling a relatively mature asset into a strong commodity price environment improves our go-forward capital efficiency and allows us to accelerate share buybacks, strengthen our balance sheet and increase long-term value for shareholders."