PennEnergy picks up Marcellus assets from bankrupt Rex Report

Deal Insight 04 September 2018

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Report summary

PennEnergy's bid to acquire Rex Energy's assets for US$600.5 million (including US$29.5 million of cash) was approved by a bankruptcy judge on 30 August 2018. Both Rex and PennEnergy operate primarily in the Pittsburgh Area sub-play of the Marcellus Shale. Rex reported Q2 2018 production of 244.3 mmcfed (46% natural gas, 54% condensate and NGLs). As PennEnergy's existing position straddles Rex's Marcellus acreage in Butler County, the purchased assets are uniquely valuable to the buyer. PennEnergy should realize upside to our base case valuation through operational cost synergies, such as extended lateral drilling.