Centennial scoops up Colgate for $3.9B

Publicly traded Centennial Resource Development Inc. and private equity-backed Colgate Energy Partners III announced plans Thursday to combine in a merger-of-equals that values Colgate at $3.9 billion, creating a $7 billion pure-play in the Delaware Basin within the Permian Basin of West Texas and southern New Mexico.

The deal involves Centennial issuing 269.3 million shares (about 94 percent of Centennial’s shares outstanding) and paying $525 million in cash to Colgate. Centennial will also take on Colgate’s $1.4 billion in debt.