WhiteHawk Energy is acquiring PHX Minerals in a deal valuing PHX at $187 million. (Source: Shutterstock.com)
WhiteHawk Energy has agreed to acquire PHX Minerals in a deal valuing PHX at $187 million, including net debt.
WhiteHawk Income Corp. will acquire PHX for $4.35 per share, the companies said after markets closed May 8. The deal represents a 21.8% premium over PHX’s closing share price on May 7. Shares for PHX were up nearly 20% in afterhours trading on May 8.
WhiteHawk will add PHX’s portfolio of 1.8 million gross unit acres of natural gas mineral and royalty assets. The deal includes significant holdings in the Haynesville Shale and expands WhiteHawk into the Midcontinent SCOOP-STACK plays.
“PHX’s Board of Directors conducted a robust strategic alternatives process to maximize value for our stockholders, and we unanimously determined the transaction with WhiteHawk achieves this objective,” said Chad Stephens, president and CEO of PHX.
WhiteHawk owns a minerals and royalties portfolio of 1.3 million gross unit acres in the Marcellus and Haynesville shales.
The combination will yield a company with 3.1 million gross unit acres and cash flowing from 10,163 producing wells. The pro forma company will also have 368 wells in progress, 330 permitted locations and 7,250 undeveloped locations.
The PHX deal will give WhiteHawk greater exposure to top-tier operators, including Expand Energy, Comstock Resources and Aethon Energy in the Haynesville, and Continental Resources and Devon Energy in the Midcontinent.
WhiteHawk’s top operators in Appalachia are EQT Corp., Range Resources, CNX Resources and Antero Resources.
“PHX’s assets are underpinned by over 6,500 producing wells and significant undeveloped inventory that will increase and diversify our cash flows while providing potential upside,” said Daniel Herz, WhiteHawk’s chairman and CEO.
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PHX Minerals Explores Sale After Rejecting Acquisition Bids
The deal agreement ends nearly two years of public back-and-forth between WhiteHawk and PHX. PHX had rejected multiple unsolicited acquisition bids from WhiteHawk since August 2023.
In the latest bid, WhiteHawk made a public offer to buy PHX for $4 per share. A month passed; WhiteHawk badgered PHX for a response.
PHX ultimately urged its shareholders to reject WhiteHawk’s $4 per share all-cash bid, arguing that the deal was not in the best interest of investors. PHX continued to explore strategic alternatives with its bankers afterward.
Amid an improving natural gas macro, WhiteHawk expanded its Marcellus holdings with a $118 million acquisition this spring. The deal doubled the company’s interest in existing Marcellus holdings in Washington and Greene counties, Pennsylvania.
The WhiteHawk-PHX deal is expected to close in the third quarter.
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NatGas Rising: WhiteHawk Inks $118MM Marcellus Royalties Deal
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