Deal Insight
Parsley Energy acquires Jagged Peak Energy for US$2.4 billion
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*Please note that this report only includes an Excel data file if this is indicated in "What's included" below
Report summary
On October 14, Parsley Energy announced that it is attempting to acquire Jagged Peak in all-stock deal, valued at US$2.4 billion. Post completion, shareholders of Parsley and Jagged Peak will own 77% and 33% of the pro-forma company respectively. The deal is very consistent with current M&A themes: gain more inventory, reduce combined G&A, add shared lease lines, and cut combined capex. It's all a path to create cashflow. However, we believe Parsley should've cored up its Midland position instead of expanding the lower tier portion of its asset base. The company has 10+ years of remaining inventory in the Midland with lower break-evens compared to its pro-forma Delaware Basin assets. If the goal is to eventually flip the position to a larger outfit, it is unclear who that buyer will be given the environmental/capex/volume risk.
Table of contents
- Executive summary
- Transaction details
- Upstream assets
- Deal analysis
- Upsides and risks
- Strategic rationale
- Oil & gas pricing and assumptions
Tables and charts
This report includes the following images and tables:
- Executive summary: Table 1
- Jagged Peak and Parsley acreage map (Oil in Place)
- Average Delaware Basin well productivity by reservoir since 2016
- Upstream assets: Table 1
- Deal analysis: Table 1
- Deal analysis: Table 2
- Aggregate Wolfcamp well productivity for Delaware Basin operators since 2017
- Deal analysis: Table 3
- Deal analysis: Table 4
- Deal analysis: Table 5
- Parsley Energy
- Oil & gas pricing and assumptions: Table 1
- 1 more item(s)...
What's included
This report contains:
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