Magnolia to Buy WildFire in $4.1 Billion Deal to Expand Eagle Ford Position

3 weeks ago 7

Magnolia Oil & Gas has agreed to get privately held WildFire Energy successful a transaction valued astatine astir $4.06 billion, a determination that much than doubles its acreage successful the Giddings country of South Texas and creates 1 of the region's largest Eagle Ford and Austin Chalk positions.

The acquisition adds astir 810,000 nett acres to Magnolia's existing holdings, bringing its full Giddings presumption to much than 1.25 cardinal nett acres. The combined portfolio provides vulnerability to aggregate productive formations, including the Austin Chalk, Eagle Ford and Woodbine, portion strengthening the company's beingness adjacent premium Gulf Coast markets.

Magnolia said the acquired assets presently nutrient astir 53,000 barrels of lipid equivalent per day, with astir 70% of output consisting of oil. The institution expects the transaction to instantly summation currency flow, escaped currency travel and net per stock portion lowering its firm reinvestment rate.

The institution besides expects to make much than $100 cardinal successful yearly synergies done operational efficiencies, infrastructure integration and little firm costs. Included successful the acquisition are a soil excavation that supplies astir of Magnolia's completion soil needs and much than 500 miles of state gathering pipelines successful Giddings.

Reflecting assurance successful the combined business, Magnolia announced a 9% summation successful its quarterly dividend to $0.18 per share, payable successful the 3rd 4th of 2026, portion maintaining its existing stock repurchase program.

The acquisition volition beryllium financed done a operation of stock, assumed debt, currency connected hand, caller indebtedness and equity. WildFire owners volition person 32.2 cardinal Magnolia shares, portion Magnolia volition presume $600 cardinal of WildFire's outstanding notes. The transaction is expected to adjacent successful the 3rd 4th of 2026, taxable to customary conditions.

Separately, Magnolia reported second-quarter accumulation of 106,100 barrels of lipid equivalent per day, including 41,900 barrels per time of oil, and raised its standalone 2026 accumulation maturation forecast to 6%, up from 5%.

The woody underscores continued consolidation crossed the U.S. shale assemblage arsenic operators prosecute larger, contiguous acreage positions that tin enactment longer laterals, little operating costs and stronger escaped currency travel contempt a much disciplined commodity terms environment.

By Charles Kennedy for Oilprice.com

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