Diamondback Energy Estimates FireBird Acquisition Accretive In 2023

  • Scott Peters
  • Oct 12, 2022
  • Diamondback Energy agreed to acquire FireBird Energy and guided the purchase to be accretive in key financial metrics.

    Diamondback Energy Inc increased 1.4% to $141.35 after the company agreed to acquire FireBird Energy for $1.6 billion in cash and stock. 

    The company said it has agreed to purchase all leasehold interest in 75,000 contiguous acres and related assets of FireBird in exchange for 5.86 million shares of its common stock and $775 million cash.

    The Midland, Texas based company is focused on exploring and developing energy fields in the Permian Basin in West Texas. 

    The purchase adds oil fields that are adjacent to the current fields owned by the company and the purchase is expected to add inventory of oil and gas at the current rate of production. 

    The independent oil and natural gas company estimated the transaction to be immediately accretive in 2023 and 2024 financial metrics including cash flow per share, free cash flow per share and net asset value per share. 

    The company expects the acquisition to close in the fourth quarter 2022. 

    The crude oil production, at the time of closing, of 17 million barrels of oil per day is expected to increase to average 19 million in 2023.  

     


Annual Returns

Company Ticker 2022 2021 2020
Diamondback Energy Inc FANG 36% 119% -47%