Contango Oil & Gas, based in Houston, has agreed to acquire Mid-Con Energy Partners, based in Tulsa for $43 million. After the deal closes, the headquarters of the combined company will move to Fort Worth.
The biggest shareholder in both companies is Goff Capital, based in Fort Worth.
Contango’s operations are mostly in Central Oklahoma and the nearby Western Anadarko Basin. Mid-Con’s assets are also primarily in Central Oklahoma. In fact, in June, Contango signed a management services agreement with Mid-Con to provide operational services as the operator of record on Mid-Con’s properties.
In an all-stock transaction, Contango is issuing shares worth $42.8 million to the unit holders of Mid-Con, a 5% premium. After the deal closes in late 2020 or early 2021, Contango shareholders will own 87% of the combined company.
John Goff and affiliated parties own 28% of Contango. The CEO of Contango, Wilkie Colyer, is also based in Fort Worth. Mr Goff acquired his stake in 2018 and installed Mr Colyer as the CEO shortly thereafter. Mr Wilkie was a non-executive director of Mid-Con until he resigned in June 2020.
That resignation was part of a recapitalization of Mid-Con. Mr Goff ended up owning 56% of it. He also appointed his son, Travis, to the Board.
The deal follows a recent spate of all-stock transactions in the E&P sector
- ConocoPhillips, based in Houston, agrees to acquire Concho Resources (Midland) for $9.7 billion.
- Pioneer Natural Resources (Dallas) buys Parsley Energy (Austin) for $7.6 billion. (Dad Scott Sheffield is the CEO of Pioneer, son Bryan is the founder and chairman of Parsley).
- Devin Energy (Oklahoma City) agrees to buy WPX Energy (Tulsa) for $2.6 billion.