Comprehensive Energy Data Intelligence

Information About Energy Companies, Their Assets, Market Deals, Industry Documents and More...

Continental Resources Becomes Private, Harold Hamm Purchases it for $4.3 Billion

Continental Resources Inc. agreed to be purchased by its founder, Harold G. Hamm, in a $4.3 billion cash deal that would take the U.S. shale giant private.

On October 17 Continental, based in Oklahoma City, concluded an agreement to be acquired by Omega Acquisition Inc., an entity owned by Hamm, for $74.28 per share. The offer price denotes a 15% premium to the closing price on June 13 — the day before Hamm’s family revealed their initial $70 per share proposal.

Being an industry icon who helped lead the charge to lift America’s 40-year-old ban on U.S. crude oil exports, Hamm had managed to establish Continental Resources in 1967. Since then, the company has evolved into one of the top 10 oil producers in the U.S.

However, Continental became public in 2007, as the public market rewarded companies for both growth and performance, according to Harold G. Hamm.

Throughout a long time, the public market has changed, especially since the COVID pandemic. Hamm is convinced that the market response has not been there for the oil and gas industry, noting the decreasing number of public E&P companies.

David Deckelbaum, managing director, and senior analyst at Cowen agreed with Hamm’s view that Continental is not obliged to be supported by capital markets, given its healthy free cash flow (FCF) yield and a leverage-neutral profile in 2023 and even taking into account plans to partially finance the transaction through a new term loan facility.

Even with the proposed incremental leverage from the buyout, CLR would be almost 0.6x leveraged in 2023, and expected FCF, even before assuming reduced costs from going private (else dividend), would have the term loan repaid in about 1.5 years. As a private company, Continental should have greater freedom to operate, particularly in areas such as exploration.

Being a chairman of Continental Resources, Hamm and his family own 83% of the company’s stock. Based on the shares outstanding as of October 12, the tender offer would be for almost 58 million shares of common stock, according to the Continental release.

The tender offer values Continental at roughly $27 billion. The offer price is slightly under Siebert Williams Shank & Co. LLC’s $75 price target and compares to the consensus price target of $72.86 on FactSet and $71.73 on Bloomberg.

Continental is the largest leaseholder and the largest producer in the nation’s premier oil field, the Bakken play of North Dakota and Montana. Continental is considered to be the largest producer in the Anadarko Basin of Oklahoma. Additionally, the company has newly purchased positions in the Powder River Basin of Wyoming and the Permian Basin of West Texas.

Meanwhile, the merger transaction does not demand a vote by Continental’s shareholders and is anticipated to close before year-end. Following closing, the remaining public operators in the Bakken will include Chord Energy Corp., ConocoPhillips Co., Hess Corp., Devon Energy Corp., Northern Oil and Gas Inc., Marathon Oil Corp., Ovintiv Inc., and Exxon Mobil Corp.

Continental’s board of directors, acting on the unanimous recommendation of a special committee including only independent and disinterested directors, has approved the merger agreement and the transactions contemplated thereby and recommended that Continental’s shareholders tender their shares of common stock under the tender offer.

Intrepid Partners LLC is acting as financial adviser and Vinson & Elkins LLP (V&E) is acting as legal counsel to Hamm. Evercore is a financial adviser and Wachtell, Lipton, Rosen & Katz is providing legal counsel to the special committee of the Continental Resources board of directors. Sidley Austin lawyers Mark Metts and Kayleigh McNelis represented Evercore.

If you are looking for more information about energy companies, their assets, and energy deals, please, contact our sales office mapping@hartenergy.com, Tel. 619-349-4970 or SCHEDULE A DEMO to learn how Rextag can help you leverage energy data for your business.

FREE TRIAL

Continental Resources Profile: 2022 vs 2023 Overview with 2024 M&A Moves

Continental Resources is actively involved in innovative energy projects to enhance oil production and environmental sustainability. The company has invested $250 million in the world's largest carbon capture and sequestration (CCS) project, a partnership with Summit Carbon Solutions. This project aims to capture CO2 from industrial sources in the Midwest and store it in North Dakota's Williston Basin, where Continental has significant experience and presence. In the Powder River Basin, Continental has expanded its operations by acquiring 400,000 acres. It is now the second-largest producer in this area, achieving high initial productivity from its Niobrara wells. The company aims to develop a competitive program across its portfolio, drawing on its successes in the Williston Basin. In the Williston Basin, known for its Bakken play, Continental is enhancing oil recovery through innovative well completion designs and exploring the potential of refracturing existing wells. These efforts are part of Continental's broader strategy to increase oil extraction efficiency and contribute to environmental sustainability.

The $26 billion purchase of Endeavor Energy Resources by Diamondback Energy, with its stock up 2.6%, is the newest big deal combining oil and gas production in the Permian Basin under a few big companies

As world leaders gather at the COP29 climate summit, a surprising trend is emerging: some of the biggest oil companies are scaling back their renewable energy efforts. Why? The answer is simple—profits. Fossil fuels deliver higher returns than renewables, reshaping priorities across the energy industry.

The global oil market is full of potential but also fraught with challenges. Demand and production are climbing to impressive levels, yet prices remain surprisingly low. What’s driving these mixed signals, and what role does the U.S. play?

Shell overturned a landmark court order demanding it cut emissions by nearly half. Is this a victory for Big Oil or just a delay in the climate accountability movement?

2024 blog posts