© 2014 The Texas Lawbook.
By Natalie Posgate – (September 29) – Canadian energy producer Encana Corporation is gaining more of a presence in Texas with its merger agreement to acquire Fort Worth-based Athlon Energy Inc. for $5.93 billion. When the $1.15 billion of debt is included, the deal value totals to $7.1 billion.
A team of Houston lawyers from Latham & Watkins handled the corporate aspect of the deal for Athlon. Partners Sean Wheeler and Michael Dillard served as the lead attorneys and received assistance from associates Enoch Varner, Kevin Richardson, Alcide King, Ryan Reiffert, Emily Korinek, Sheila Forjuoh, Brock Naeve and Matthew Olson.
More attorneys from Houston on the Latham deal team included finance partner Craig Kornreich and associate Pamela Kellet, tax partner Tim Fenn and associate James Cole, environmental partner Joel Mack and associate Alicia Handy and oil and gas transactional partner Michael King. Attorneys from the firm’s Los Angeles and Washington, D.C. offices also worked on the transaction.
Latham has had Athlon as a client since the independent exploration and production company formed in 2010. Matters Latham has handled for Athlon include the company’s August 2013 initial public offering and various acquisitions. In June, Latham closed a deal for Athlon involving an acquisition of producing properties and undeveloped acreage in the northern Midland Basin for $873 million.
Vinson & Elkins co-advised Encana in the deal with the New York law firm Paul, Weiss, Rifkind, Wharton & Garrison and Toronto-based Blake, Cassels & Graydon. New York partners David Cohen and Shelley Barber led the V&E team.
Encana’s presence in West Texas will be beefed up with the acquisition of Athlon, which focuses on the acquisition, development and exploitation of unconventional oil and liquids-rich natural gas reserves in the Permian Basin.
In the joint press release, Encana said it plans to invest at least $1 billion of capital in the shale play and ramp up from three to at least seven horizontal rigs by the end of 2015. The company also expects the acquisition to add current production of about 30,000 barrels of oil equivalent per day (boe/d) based on Athlon’s current estimated production including recent acquisitions.
The transaction is expected to close by the end of the year.
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