Amplify Energy announces merger with Juniper Capital

HOUSTON - Amplify Energy Corp. (NYSE: NYSE:AMPY), an independent oil and natural gas company currently valued at $257.71 million and trading at $6.48 per share, has entered into a definitive merger agreement with Juniper Capital. The deal, expected to close in the second quarter of 2025, will see Amplify issuing approximately 26.7 million shares and assuming around $133 million in net debt.

Upon completion, Amplify shareholders will retain about 61% of the outstanding equity, with Juniper owning the remaining 39%. Trading at an attractive Price/Book ratio of 0.62 and P/E ratio of 4.16, Amplify's merger will significantly increase its scale, adding roughly 19 million barrels of oil equivalent (MMBoe) of Proved Developed Reserves and approximately 287,000 net acres in Wyoming's DJ and Powder River Basins. For detailed valuation metrics and more insights, check out InvestingPro.

The strategic rationale behind the merger includes the substantial increase in scale, improvement in operating metrics and corporate efficiency, and the creation of opportunities for organic growth. With a "GOOD" Financial Health Score of 2.88 on InvestingPro, Amplify has identified numerous potential high-quality drilling locations, which are expected to be accretive to free cash flow in 2025 and beyond.

Martyn Willsher, Amplify's President and CEO, stated that the merger with Juniper's assets would create immediate and long-term value for shareholders, adding a significant production area with upside potential. Edward Geiser, Juniper's Managing Partner, expressed confidence in Amplify's team to lead the combined operations.

The merger is also anticipated to bring material synergies, including overhead optimization and income tax savings. The expanded asset base is expected to provide a platform for further consolidation opportunities in the region.

Amplify's Board of Directors will see changes with Edward Geiser and Josh Schmidt, partners at Juniper Capital, replacing two existing members. The management team of Amplify will lead the combined company, with plans to supplement the operational team to support the new assets.

Advisory roles were filled by Houlihan Lokey (NYSE:HLI) Capital, Inc. and Kirkland & Ellis, LLP for Amplify, and Wells Fargo (NYSE:WFC) and Gibson, Dunn & Crutcher LLP for Juniper.

This news article is based on a press release statement and contains forward-looking statements that are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed. Analysts maintain a positive outlook on Amplify, with price targets ranging from $9 to $11 per share. Access comprehensive analysis and additional ProTips through InvestingPro's detailed research reports.

In other recent news, Amplify Energy Corp. announced strong financial and operational results for the third quarter of 2024. The company reported an adjusted EBITDA of $25.5 million and a significant increase in net income to $22.7 million. This improvement was largely attributed to a non-cash unrealized gain on commodity derivatives and successful drilling activities. Amplify invested $18.2 million in capital expenditures, mainly in Beta facility projects and development drilling, and reported a free cash flow of $3.6 million for the quarter.

In terms of operational activities, the company is exploring monetization of Wyoming assets and East Texas acreage. It also reported a decrease in lease operating expenses due to optimization efforts and an improved leverage ratio. Production for the quarter averaged 19,000 barrels of oil equivalent per day.

Looking forward, Amplify anticipates capital expenditures for the year to be at or slightly above the $60 million to $65 million guidance range. Furthermore, it is evaluating potential capital return options for 2025, dependent on development activity and debt levels. These recent developments reflect Amplify's commitment to strategic investments and operational efficiencies.

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