Fort Worth, Texas-based company, Energy & Exploration Partners announced that it will be acquiring Chesapeake Energy Corporation (NYSE:CHK) acreage in Texas for $125 million.
The Emerging oil and gas producer revealed in a statement filed with the Securities and Exchange Commission ,that it has signed a deal with Chesapeake Energy Corporation (NYSE:CHK) to buy its 57,275 net acres in the Eaglebine formation in Texas. The Company also said that the deal is expected to be completed in the fourth quarter.
Oklahoma City-based Chesapeake Energy Corporation (NYSE:CHK), has been divesting its stake in various oil and gas acreage to stay on the growth path and also to reduce its capital spending commitments.
Energy & Exploration Partners Inc plans to fund the acquisition from the proceeds raised through the initial public offering of its common stock. The Texas based company also filed with the regulators on Monday to raise up to $275 million in an initial public offering of its common stock. The Company revealed to the U.S. Securities and Exchange Commission in a preliminary prospectus that Canaccord Genuity and Johnson Rice & Co LLC are lead underwriters to the offering.
Apart from this, America’s second biggest gas producer, Chesapeake Energy Corporation (NYSE:CHK), has also planned to sell off its glass-and-granite office tower in Fort Worth, Texas. Julia Wilson, a senior executive at the oil giant, said the company is showing it to potential buyers. ”The intention is to sell the building. We are certainly amenable to any good offers,” Wilson told the Star Telegram. Chesapeake Energy Corporation (NYSE:CHK) is reportedly scaling back on its Barnett Shale operations. Chesapeake Energy has been one of the many players in the industry to be affected by increasing costs of mining shale oil. Like other big players, Chesapeake has also exposed its balance sheets to excessive credit, as it seeks to increase its earnings to match those of other companies from around the world, it spend nearly $1.3 billion in capital expenditure during Q2, as compared to a net income of $972 million.