Dicker Thinks the Markets Got the Southwestern Deal Right – And Natural Gas is Going Nowhere

Dan Dicker, energy contributor at TheStreet, talks with Brittany Umar about the $5.4 billion sale of Marcellus assets to Southwestern Energy (SWN) from Chesapeake Energy (CHK). Despite a strong portfolio of producing properties, Dicker thinks that Southwestern not only paid too much, but that it also needs far more robust natural gas prices than before to make this purchase worthwhile, a prospect Dicker does not believe is likely. In addition, the $5.4B price tag forces Southwestern to raise new, fresh capital for development immediately, a tremendous burden for a company with only an $11 billion market cap.