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LONDON (Alliance News) - Riverstone Energy Ltd on Monday said it has agreed to sell 100% of the membership interests in Rock Oil Holdings LLC for USD237.0 million, more than double what it originally invested.
The company has agreed to sell the interests in Rock Oil, a US-based oil and gas company focused on the Permian basin, to SM Energy Co, another US-based oil firm.
Rock Oil was formed in March 2014 with the strategy of applying Rock Oil's land and technical expertise to the acquisition and development of assets in top-tier North American plays. Since formation, Rock Oil has entered into a series of acquisitions and currently produces around 4,900 barrels of oil equivalent per day.
Riverstone's original investment was USD114.0 million, meaning the gross proceeds of the deal amount to USD123.0 million. Notably, the sale price also is 55% higher than the valuation of Rock Oil at the end of June this year of only USD152.0 million.
"The company's gross profit of USD123.0 million will be subject to taxes and a performance fee upon closing of the sale, which is expected to occur in early October and is subject to customary closing conditions," said Riverstone.
Riverstone shares were trading up 2.4% to 1,065.0 pence per share on Monday afternoon.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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