Devon Energy (DVN) agreed to sell its assets in the Eagle Ford basin to Crescent Energy (CRGY) for $4.2 billion in cash, it said Thursday, moving to divest a relatively mature holding to focus on better-performing assets.
The Eagle Ford portfolio comprise about 90,000 net acres across Karnes, DeWitt and Gonzales counties in Texas, representing approximately 4% of Devon’s total barrels of oil equivalent production.
Devon said the transaction price is accretive on a per-share basis to free cash flow and net asset value.
“This sale is a direct outcome of our ongoing portfolio review, and it sharpens our focus on the highest-return, longest-duration assets,” Devon Chief Executive Clay Gaspar said. “Selling a relatively mature asset into a strong commodity price environment improves our go-forward capital efficiency and allows us to accelerate share buybacks, strengthen our balance sheet and increase long-term value for shareholders.”
Earlier this year, the company completed its merger with Coterra Energy, acquired Delaware Basin inventory in the federal lease sale and invested in the Solitude pipeline project.
Separately, Crescent estimated the net purchase price at about $3.85 billion after factoring in certain adjustments.
Crescent said the deal strengthens its Eagle Ford position, with the assets located directly adjacent to its existing operations. The company has identified roughly $140 million in annual synergies.
Devon expects the transaction to complete around the end of the year, while Crescent anticipates closing in the last quarter of 2026 or early 2027.
“This acquisition represents a significant step forward for Crescent, adding high-quality assets at an attractive valuation in the heart of one of our core operating areas,” Crescent CEO David Rockecharlie said. “We know these assets exceptionally well through our longstanding minerals ownership and nearby operations, and see meaningful opportunity to make them even better.”
Shares of Devon were up 2.2% in Thursday trade, while those of Crescent declined 4.2%.
Seaport Research Partners initiated coverage of sixteen US oil-weighted upstream operators last month, including a buy rating on Devon, which was also one of its top picks.
“We think the quality and scale of the combined (Coterra/Devon) Delaware Basin position is unmatched, and that consensus is likely not fully capturing the impact of synergies delivery on a portfolio that will likely be streamlined significantly from where it stands today,” Seaport said.
Seaport also initiated coverage of Crescent, with a sell recommendation.
“We appreciate (Crescent’s) strategy and trust their operational track record,” the brokerage said. “Entry into the Permian comes with some new challenges, which the company has navigated well, but we find it difficult to be constructive on basically any name deliberately seeking to manage oil production volumes lower (at least until they find a floor).”
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