Frisco, TX, June 10, 2019 (GLOBE NEWSWIRE) –
INCREASES RESOURCES FOR HAYNESV'S BASIN LEADER'S CENTRAL PARK ENERGY ACQUISITION $ 2.2 billion
Creates Haynesville Pool Manager 1.1. 2000 internet drilling positions
Jerry Jones invested $ 475 million, totaling $ 1.1 billion
FRISCO and DALLAS, TX, June 10, 2019 – Comstock Resources, Inc. (NYSE: CRK) (Comstock or “Company”) and Covey Park Energy LLC (“Covey Park”) as we speak introduced that Comstock has entered into an agreement to buy Covey Park for money and stock trading value approximately $ 2.2 billion. outstanding debt and retirement of Covey Park's present low-cost models totaling roughly $ 1.1 billion. Covey Park is a privately owned pure fuel firm that operates at the coronary heart of the Haynesville shale surroundings.
The acquisition of Covey Park enhances and extends Comstock's place in Haynesville Shale and accelerates its progress in the direction of strategic and financial objectives for sustainable freedom. generating cash move and decreasing leverage. The highlights of the occasion are:
Comstock to turn into Director of Haynesville, Premier Fuel Pool Superior Economics
- Over 1.1 Bcfe / day internet production, about 374,000 internet kilometers and 5.4 Tcfe SEC confirmed reserves and 7.6 Tcfe SPE turned out to be reserves  293,000 internet identifiers with roughly 2,000 internet drilling websites, together with approximately 1,300 internet points with a aspect size of more than 5,00zero ft
- A combined management workforce drilling more than 500 horizontal Haynesville slurries
Free money circulate Generating industry-leading margins
- Value construction of a category natural fuel unit, the place the industry's leading EBITDAX margin was 76%
- $ 935 million EBITDAX based mostly on pro forma calculation for 1Q 2019
- Professional type expects fund drilling plan beneath operational money stream
- Professional Type 2019 estimated leverage ratio of two.9x, aimed toward decreasing e 2.zero x by 2021 [1 9659009] Improves per-unit capital effectivity and operating profit per unit and offers over $ 25 million per yr for anticipated company and company restructuring
Low cost Value, Flexible Pure Fuel Advertising Options
- 500 Kilometers of Fuel Collection Infrastructure
- Gulf Coast Demand and Agreements Associated to Henry Hub
- Low Prices for Accumulating, Handling and Transport
- Minimal Variety of Commitments
Concentrating on Partners for Success
- Profitable Dallas businessman Jerry Jones stays the company's largest shareholder with a 75 % holding and $ 1.1 billion cumulative investment
- Denham Capital, a serious energy-based venture capital agency with invested and dedicated capital of $ 9.7 billion, would be the second largest Shareholder holding roughly 16% of the shares
The boards of each corporations authorised the deal unanimously. At the end of the deal, Comstock's Board of Administrators can be extended to CEO of Covey Park, John Jacob and Jordan Mary, CEO of Denham Capital. The Government Group is headed by Comstock's current Managing Director, M. Jay Allison, however it consists of illustration from both Management Teams and combines the employees of both corporations to keep expertise and achieve an effective group.
Dallas proprietor Jerry Jones Cowboys soccer Ltd, stated: "I am pleased to provide funding and, together with Denham Capital to combine the two companies to create a basin-director Haynesville shale. This combination is another step towards creating your vision as the industry's leading natural gas company. "
M. Comstock CEO Jay Allison commented: “After evaluating a number of potential goals with Haynesville slate, I believe we have found a perfect merger partner. This merger is perfect for our current area and continues our strategic plan to create significant proportions and depths of resources on the Haynesville slate. The combined company has a stronger balance sheet, enhanced by a list of high-quality, low-cost, high-yield drilling opportunities. In the integration of Covey Park, we plan to focus on operational efficiency and introduce a combined drilling program that offers significant free cash flow to achieve our goal of reducing leverage. ”
John Jacobi and Alan Levande, Covey Park CEOs, commented:“ We’re very pleased with the corporate we now have constructed for the productive Haynesville slate. We consider that the mixed firm has vital economies of scale and wonderful basis for vital organic progress with engaging cash flows. "
Jordan Marye, CEO of Denham Capital, added:" On behalf of Denham, we take a look at Jerry Jones and Comstock when the company develops helpful belongings, the Covey Park group on the heart of Haynesville. We consider that Mixed Teams and the Firm's Complementary Belongings, together with Jones' substantial help, will make Comstock the perfect company to provide priceless worth for these belongings. ”
Financing and Transaction Construction
Jerry Jones invests $ 50,00zero,000 in Comstock shares at $ 6.00 per share and $ 175 million in ever-convertible shares for cash of $ 475 million. A further co-investment will deliver Jerry Jones's complete investment into Comstock for about $ 1.1 billion.
At the end, Comstock takes Covey Park's current $ 625 million 7.5 % older banknotes, retired quantities based mostly on Covey Park's credit line and redeemed all excellent previously issued
In reference to the deal, the Company has appointed BMO Capital Markets to have modified and adjusted 2 , A $ 5 billion financial institution credit score facility with an initial mortgage of $ 1,575 billion and a maturity of 5 years. The company plans to select a $ 1.5 billion mortgage base. The cash consideration payable in the deal is financed by a mixture of Jerry Jones' holding and the company's financial institution credit facility.
Covey Park shareholders obtain $ 700 million in money, $ 210 million in lately issued convertible bonds and 28,833,00zero new Comstock shares issued at an agreed worth of $ 6.00 per share.
$ 385 million in newly issued main shares is a quarterly dividend of 10% every year and could be transformed into shares with a share worth of $ 4.00 per share, beginning one yr after the difficulty date. The Firm has the correct to redeem the Most popular Inventory at any time at nominal value plus accrued dividends.
The transaction is predicted to end on July 31, 2019, or earlier than December 31, 2016, offered that certain regulatory approvals and different normal closures are met.
Wells Fargo Securities, LLC acts as Comstock's main financial advisor, and BMO Capital Markets also acts as Comstock's financial advisor. Locke Lord LLP acts as Comstock's legal advisor. BofA Merrill Lynch and Barclays are Covey Park's main financial advisor. Citigroup International Markets Inc. and Goldman Sachs & Co. LLC additionally offered monetary advice to Covey Park. Vinson & Elkins LLP acts as Covey Park's authorized advisor.
Conference Name and Webcast
For more details about the event and Comstock's strategy, please refer to the conference call scheduled for June 10, 2019 at 9:00 am Central Time. The telephone quantity used for the conference name is 844-776-7840 (worldwide dial-up connection 614-699-6629) and it supplies access code 2465846. The convention call and the investor's presentation are webcasts and could be discovered at .crkfrisco.com Comstock's "Investors "or in the following hyperlink: https://edge.media-server.com/m6/pf5wk8sh9 . Net playback is on the market for a few week. The convention call is accessible from 13:00. Central Time June 10, 2019 and continues till 13:00. Central Time June 17, 2019. If you need to pay attention to the play, name 855-859-2056 (404-537-3406 in case you are calling from outdoors the US). Conference Calling Code 2465846
Comstock is a rising unbiased power company engaged in the acquisition, improvement, production and exploration of oil and fuel properties, mainly in Texas, Louisiana and North Dakota. For more info, please go to www.crkfrisco.com . The corporate's odd shares are traded underneath the NYSE code "CRK".
Comstock Contact: Roland Burns, CFO, 972-668-8800
Gary Guyton, Director of Planning and Investor Relations, 972-668-8834
Covey Park is an unbiased pure fuel company that engages in the improvement, improvement and analysis of and fuel properties in Haynesville and Bossier strip designs in North Louisiana and East Texas. Its highly experienced management workforce focuses on maximizing company-level returns by creating a variety of repeatable, low-risk, high-margin natural fuel drilling capabilities. For extra info, see www.coveypark.com .
Covey Park Contact: Richard Burnett, Government Vice President and Chief Monetary Officer 214-548-6000
Ernesto Alegria, Chief Monetary Officer, 214-627-9711
Denham Capital is a number one power and resource-oriented international venture capital firm, with over $ 9.7 billion invested and dedicated capital in ten foreign money models and workplaces in Houston, London, Boston and Perth. The corporate makes direct investments in the power and useful resource sectors, including oil and fuel corporations, power era and mining operations around the globe and in any respect levels of the company's life cycle. Denham Funding Professionals apply in-depth operational and industrial expertise and collaborate with management teams to obtain long-term investment objectives. For more info on Denham Capital, go to www.denhamcapital.com
Warning Statement for Future Info
This press launch might include certain "forward-looking statements", together with sure plans, expectations, objectives, forecasts, and statements about the benefits of the proposed transaction, from Comstock Resources Plans , objectives, expectations and intentions, the expected schedule of the occasion, and other statements that are not historic details. Such statements contain numerous assumptions, risks and uncertainties. Statements that do not describe historic or present details, together with statements of beliefs and expectations, are forward-looking statements. Ahead-looking statements may be identified by phrases similar to wait, anticipate, faith, intent, estimation, plan, aim, objective, or comparable expressions or future or conditional verbs, comparable to will, whether, whether, whether, or, or comparable variations. Future statements are meant to be in accordance with section 27A of the 1933 Securities Act, Article 21E of the 1934 Stock Change Act and the Personal Securities Settlement Act of 1995 (19659005). there isn’t a certainty that each one risks and uncertainties or danger elements are full, listed here are some elements which will cause a big distinction in precise results from future or expected results in the future statements: the likelihood that the proposed transaction won’t shut when anticipated or in any respect due to the required regulation – or other approvals will not be acquired or different closure circumstances usually are not met in time or at all; the danger that the regulatory approvals required for the proposed merger won’t be obtained or won’t be obtained beneath anticipated circumstances; any hostile results or modifications in enterprise or worker relationships, together with these resulting from the announcement or execution of the transaction; uncertainties within the timing of the event; aggressive responses to the event; the likelihood that the expected benefits of the occasion won’t materialize as expected or at all, together with the influence of the mixing of the 2 corporations or the issues they cause; the likelihood that the occasion may be costlier than anticipated, even because of sudden elements or events; transferring administration's attention to ongoing enterprise and opportunities; Comstock's capacity to successfully full the acquisition and integration of Covey Park; transaction litigation; and different elements which will affect Comstock's future outcomes
Different elements which will trigger vital variations to the above are found in Comstock's Annual Report on Type 10-Okay for the yr ended December 31, 2018, and its subsequent quarterly report on Type 10-Q for the quarter ended March 31, 2019 , every of which has been made out there to the Securities and Change Commission (SEC) and is out there in Comstock Resources' "Investors" part at http: //crkfrisco.com/, in subtitle "SEC Filings" and in other paperwork Comstock Resources information with SEC  All forward-looking statements solely converse of the date they have been made and are based mostly on the obtainable info. time. Comstock is just not obliged to update its forward-looking statements to mirror circumstances or events that occur after the forward-looking statements have been made, or mirror the prevalence of sudden events, besides for the necessities of the Federal Securities Act. As a result of forward-looking statements pose vital risks and uncertainties, warning ought to be exercised so as to keep away from unnecessary disclosure of such statements
Gary H. Guyton
Head of Design and Investor Relations