Apollo Global Management plans to de-list Parallel Petroleum in a $483 million deal that includes the assumption of $351 million in debt.
“There is no financing condition to the obligations to consummate the transaction, and funds managed by Apollo have committed to provide $283.2 million of equity to complete the transaction,” Parallel Petroleum said in a statement.
The private equity firm will pay stockholders $3.15 per share, representing a 56 percent premium to the Texas-based company’s average closing price over the past 60 days.
Oil rig: destined for Apollo's portfolio
“The board considered a range of potential alternatives, including continuing to operate as an independent entity, the returns and dilution associated with issuing additional equity in a public or private offering, the possibility of the sale of certain assets, and combinations with other merger partners,” said Jeffrey Shrader, Parallel’s chairman of the board.
Apollo partner Sam Oh led the deal.
Parallel is headquartered in Midland, Texas, and specialises in the exploitation, development, acquisition and production of oil and gas using 3-D seismic technology and advanced drilling, completion and recovery techniques.
In April, Apollo offered to buy Texas oil and gas partnership Legacy Reserves for $435 million in cash.