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Oil and gas E&P company Pioneer Natural Resources (NYSE: PXD ) announced today that it plans to absorb production and drilling company Pioneer Southwest Energy Partners (NYSE: PSE ) into its operations as a wholly owned subsidiary.
The total deal is valued at approximately $1.46 billion, equivalent to roughly 50% of Pioneer Natural Resource's FY 2012 revenue.
The all-stock purchase will trade in Pioneer Southwest Shares for Pioneer shares at a multiple of 0.2325, representing a 1% premium over Southwest's Friday closing price. Pioneer Natural had previously attempted to acquire Pioneer Southwest for around $1.1 billion in May, but the offer was turned down.
For Pioneer Natural shareholders, the company expects to issue around 3.95 million additional shares of stock to be issued, while Pioneer Southwest shareholders can rest easy that quarterly distributions will continue to be paid out until the acquisition is fully completed.