Kimmeridge-backed Civitas Resources and SM Energy announced Nov. 3 that they are merging their companies, alongside their considerable upstream shale portfolios, in an all-stock transaction valued at $12.8 billion, including what will become their mutual debt.
The combined company will have a portfolio of 823,000 acres in the Permian, ranking it one of the top-10 independents in the nation.
Under terms of the agreement, Civitas stockholders will receive 1.45 shares of SM Energy in exchange for each share of Civitas. Upon closing, SM shareholders will own an estimated 45 percent of the combined company.
After closing, the combined company, headquartered in Denver, will include six directors from SM Energy and five from Civitas.
Herb Vogel, CEO of SM Energy, announced his retirement in September, effective March 1, 2026. He will continue to serve as CEO with SM Energy COO Beth McDonald transitioning to Vogel’s position as previously planned.
Vogel said the deal ” combination creates a leading oil and gas company with enhanced scale, numerous value-adding synergies, and significant free cash flow, driving superior value to stockholders.”
Outside legal counsel includes Gibson Dunn & Crutcher for SM Energy and Kirkland & Ellis for Civitas Resources.
Evercore serves as financial advisor to SM Energy and J.P. Morgan advised Civitas.
The Gibson Dunn team advising SM Energy is led by Dallas partner Jeffrey Chapman and includes Jonathan Whalen (Dallas), Robyn Zolman (Denver), and Jonathan Sapp (Dallas), Alisa Balderas(Los Angeles), Caroline Bakewell (Houston) and Muriel Hague (Houston), Rahul Vashi (Houston) and Adam Whitehouse (Houston). Also included were Doug Rayburn (Dallas), Michael Cannon(Dallas), Sophia Hansell (Washington, D.C.) and Krista Hanvey (Dallas).
The Kirkland team advising Civitas was led by partners Doug Bacon in Houston and Kim Hicks in Austin, with assistance from Julian Seiguer (Houston), Patrick Salvo (Austin), Ieuan List (Austin), Brittany Scheier (Houston), Christian Mahre (Houston), along with Stephen Jacobson (Houston), Brandon Newman (Houston) and Mark Dundon (Houston).
Hicks also co-led another blockbuster deal announced this morning, which brings together some of the largest and most well-known consumer brands in the world.