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Diversified Energy to Acquire Birch Permian for $1.8 Billion to Expand in Permian

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Diversified Energy Company (DEC) is set to acquire Birch Permian Holdings and certain affiliates from Elliott Investment Management for $1.8 billion, marking the largest acquisition in the company's 25-year history, it said on Wednesday.

The deal is set to expand Diversified's presence in the Permian basin, establishing it as the premier operator, while increasing its overall output by 35% and adjusted EBITDA by around 55%.

Birch's assets produce 68,000 barrels of oil equivalent per day, comprising roughly 38% oil, 32% natural gas liquids and 30% natural gas. Its portfolio includes about 46,000 net mineral acres in the Permian Basin and 500 gross operated wells.

The acquisition will be funded primarily through a $1.5 billion privately rated asset-backed securitization originated and structured by private equity firm Carlyle, and partially through Diversified's revolving credit facility, the company said.

Separately, Diversified and Carlyle have agreed to expand their strategic partnership to pursue up to $10 billion in additional opportunities, which they said was aimed at combining attractive financing with operating expertise.

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