Contango Oil & Gas Company (NYSE MKT: MCF) and Crimson Exploration Inc. (NasdaqGM: CXPO) jointly announced today that they have formally closed their previously announced merger. The combined company will be a well-positioned Houston-based independent oil and gas company with a balanced offshore Gulf of Mexico and onshore Texas production profile. Both Contango and Crimson stockholders voted to approve the transaction at a special meeting of their respective stockholders.
In accordance with the terms of the merger agreement, Crimson has become a wholly-owned direct subsidiary of Contango, and Contango will issue approximately 3.9 million shares of its common stock in exchange for all of Crimson's outstanding capital stock.
Contango also announced today its newly constituted board of directors consists of Joseph J. Romano, Allan D. Keel, B.A. Berilgen, B. James Ford, Brad Juneau, Lon McCain, Charles M. Reimer, and Steven L. Schoonover. The board of directors has appointed Allan D. Keel as President and Chief Executive Officer of Contango. Joseph J. Romano will remain as Chairman.
Mr. Romano said, "The new combined company will have a pre-tax SEC PV-10 proved reserve value approximating $1 billion, future resource potential which it hopes to exploit both onshore and offshore, excellent cash flow, approximately $110 million of debt and 19.1 million shares of common stock outstanding after closing."
"Allan and the company's focus will be to exploit our existing asset and lease base while continuing to add solid rate of return opportunities to the company's asset base. I know the new Contango board, its senior management and its employees are committed to the future success of the company measured by an increase in real shareholder value," added Mr. Romano.
"We are extremely excited about the potential that the merger of Contango and Crimson brings to the shareholders of both companies," said Mr. Keel. "The combined company's strong financial profile, and cash flow, positions us to aggressively pursue Crimson's high quality portfolio of onshore resource positions in various plays, complemented by an appropriate dedication of capital to Contango's potentially high impact exploratory Gulf of Mexico prospects. Our teams have been busy orchestrating the combination of these two excellent organizations and believe that it will be an exciting period going forward."