- EOG Resources (EOG, Financial) announces acquisition of Encino Acquisition Partners for $5.6 billion.
- Deal expands EOG's Utica position to 1.1 million net acres, increasing production to 275,000 barrels per day.
- EOG increases dividend by 5% to $1.02 per share, with an annual rate of $4.08.
EOG Resources, Inc. (EOG) has entered into a definitive agreement to acquire Encino Acquisition Partners from CPP Investments and Encino Energy for $5.6 billion, enhancing its portfolio with a third foundational play in the Utica. This acquisition is set to expand EOG's Utica asset, coupling it with its existing operations in the Delaware Basin and Eagle Ford.
The acquisition will be financed through $3.5 billion in debt and $2.1 billion in cash, adding 675,000 net core acres, thus creating a combined 1.1 million net acre position. With pro forma production reaching 275,000 barrels of oil equivalent per day, the deal is expected to produce immediate accretive impacts on EOG's financial metrics, including a 10% increase in EBITDA by 2025 and a 9% boost in cash flow operations.
EOG anticipates generating over $150 million in synergies during the first year from reduced capital, operating, and financing costs. Demonstrating its financial resilience, EOG has also announced a 5% increase in its regular dividend, elevating it to $1.02 per share with an indicated annual rate of $4.08. This acquisition underlines EOG's commitment to maintaining a strong balance sheet without diluting its shareholders.
The transaction is expected to close in the second half of 2025, pending regulatory approval under the Hart-Scott-Rodino Act and other customary conditions.
Also check out: (Free Trial)
