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Small and medium oil and gas producers focused on the Permian basin can become active investors.
Small and medium-sized manufacturers are reluctant to engage in detailed negotiations, according to a CTFN . report on Monday, which quotes industry participants and advisor.
According to CTFN, companies with a market capitalization of less than $10 billion operating in the Permian were recently offered premiums to participate in the takeover discussion, although they declined to participate.
According to the report, smaller companies may be overestimating their prospects, and their boards and management teams may be hurting their chances of a takeover, so they can may become vulnerable to an activist.
Permian-exposed companies with a market capitalization of less than $10 billion include Ovintiv (NYSE:OVV), SM energy (NYSE:SM), Discover Riley (NYSE:REPX) and Ring Energy (NYSE:REI).
The report on potential activity in the Permian comes after the WSJ reported in April that Exxon Mobil (XOM) hold preliminary negotiations oversion one potential acquisition by Pioneer Natural (PXD). Chevron (CVX) last month agreed to buy PDC Energy (PDCE) in an all-stock deal worth $6.3 billion to be exposed to DJ Basin.
The Financial Times reported in February that US oil producers is expected to seek to make transactions in the oil segment this year due to concerns that the best drilling sites are becoming scarcer. According to the report, the most likely targets are expected to be publicly traded oil and gas producers with a market capitalization of less than $10 billion.
More about companies with Permian exposure
