Diversified Energy Company PLC (LON:DEC) has taken a bold step forward with its latest acquisition of Maverick Natural Resources, a private energy company, in a deal valued at $1.275 billion. This transformational move not only expands Diversified’s production but also strengthens its position across key U.S. energy regions.
According to Jefferies International Limited, the acquisition will add an impressive 350 million cubic feet equivalent per day (MMcfe/d) of production, with 45% natural gas and 55% liquids. As a result, Diversified’s total production is expected to reach approximately 1,200 MMcfe/d (~200,000 barrels of oil equivalent per day).
A Strategic Shift
This acquisition marks a significant shift in Diversified’s strategy. Traditionally known for acquiring specific assets, this corporate acquisition of Maverick is a departure from its usual approach. Jefferies notes that the deal is being executed at an attractive valuation of approximately 3.3x last twelve months (LTM) EBITDA, making it a financially compelling transaction.
“The assets are being acquired at approximately 3.3 times LTM Adjusted EBITDA,” highlights Jefferies International, underlining the strong financial rationale behind the move.
Strengthening Key U.S. Positions
Maverick’s assets are strategically located across Appalachia, the Western Anadarko, Permian, Barnett, and Ark-La-Tex regions. These core geographies will allow Diversified to enhance operational efficiencies and optimise production output.
The acquisition will be funded through a combination of:
- $700 million of Maverick’s existing debt
- Issuance of 21.2 million Diversified shares (valued at approximately $345 million)
- $207 million in cash
This structured approach ensures that Diversified maintains a healthy financial position while securing long-term growth.
A Positive Outlook
The deal has been unanimously approved by the board and is expected to close in the first half of 2025. Jefferies International is serving as the financial advisor for Maverick and EIG, reinforcing the credibility of the transaction.
With $1.8 billion in combined revenue and $345 million in free cash flow, this acquisition positions Diversified Energy for sustainable growth and long-term shareholder value.
Final Thoughts
Diversified Energy’s acquisition of Maverick represents a milestone moment in the company’s expansion strategy. By securing a high-quality asset base and enhancing its geographic footprint, the company is well-positioned for stronger cash flow generation and increased operational efficiency.
With the deal set to complete in early 2025, investors and stakeholders can look forward to an exciting new chapter for Diversified Energy.
