Oasis (OAS) Issues Update on Merger, to Pay Special Dividend

Williston Basin-focused oil and gas explorer Oasis Petroleum OAS unveiled plans to give a special dividend of $15 per share, setting a conditional payment date of Jul 8. This is associated with the plan of merger between the Zacks Rank #3 (Hold) upstream operator and regional peer Whiting Petroleum WLL. Investors should know that the closure of this merger transaction is contingent on stockholder approvals after a special meeting on Jun 28, in addition to other regulatory closing conditions. As of now, the closing is slated for Jul 1, 2022.

Earlier this year, in March, Whiting Petroleum and Oasis Petroleum jointly announced that they have signed a $6-billion merger agreement of equals transaction. The firms stated that the merged entity will have the leading Williston Basin position in North Dakota and Montana, with top-tier assets spanning over 972,000 net acres and an output of about 167,800 barrels of oil equivalent per day, an improved free cash flow generation and a substantial scale of operations.

Per the terms of the transaction, Whiting shareholders will be given 0.5774 shares of OAS common stock and $6.25 in cash for each share of the WLL stock held. Oasis shareholders will receive a special dividend of $15.00 per share ahead of the close. Upon the conclusion of the deal, Whiting and Oasis shareholders will own approximately 53% and 47% in the merged company, respectively.

Both companies were hit hard by the pandemic-induced commodity price and demand destruction, and were forced to declare bankruptcy in 2020. WLL and OAS subsequently restructured and emerged from Chapter 11 by management overhaul, cutting costs and cleaning up their balance sheets.

2 Energy Stocks to Buy

Investors interested in the energy space might look at Civitas Resources CIVI and Suncor Energy SU, both carrying a Zacks Rank of 1 (Strong Buy), currently.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Civitas Resources is valued at some $4.9 billion. The Zacks Consensus Estimate for CIVI’s 2022 earnings has been revised 35.7% upward over the past 60 days.

Civitas, headquartered in Denver, CO, has a projected earnings growth rate of 368.6% for 2022. CIVI shares have gained around 10.7% in a year.

Suncor Energy is valued at approximately $49.8 billion. The Zacks Consensus Estimate for SU’s 2022 earnings has been revised 21.7% upward over the past 60 days.

Suncor Energy, headquartered in Calgary, Canada, has a trailing four-quarter earnings surprise of roughly 3.6%, on average. SU shares have gained around 32.2% in a year.

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