Proxy advisory firm Institutional Shareholder Services (ISS) recommended that shareholders of Callon Petroleum Co. vote in favor of its acquisition of Carrizo Oil & Gas Inc.

ISS had earlier urged shareholders to vote against the original Callon-Carrizo merger. However, the firm has now reversed that decision due to amended deal terms agreed on by Callon and Carrizo.

“Given the material improvement in terms, along with the strategic rationale for the merger, as noted in our original analysis, support FOR the transaction is now warranted,” ISS wrote in an updated report dated Nov. 19.

On Nov. 14, Callon lowered the price and premium of its merger with Carrizo, knocking the price of the transaction to $2.7 billion from the original $3.2 billion deal value. The new terms also won over Callon shareholder Paulson & Co. Inc., which said Nov. 18 it would no longer oppose the transaction.

Opposition of the merger not only dealt with the original deal’s 25% premium, which was lowered to 6.7% through the amended terms, but that the acquisition of Carrizo also would take Callon, previously a pure-play Permian Basin operator, into the Eagle Ford.

Despite saying it would vote in favor of the transaction, Paulson & Co. said Nov. 18 it had reduced its investment position in Callon, citing its belief that a pure Permian focused producer would be the more attractive alternative.

Shareholders will still need to approve the merger at a special meeting rescheduled for Dec. 13. The two Houston-based independents still expect to close the transaction by year-end.