Reverse Takeover: Apollo’s Chisholm to merge with Ares-backed Gastar

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[Context: On June 19, Apollo-backed Chisholm Oil & Gas, not to be confused with Warburg’s Chisholm Energy , announced agreement to merge with Ares-backed Gastar Exploration. The new company will operate as Chisholm Oil and Gas and will have 20,000 BOEPD production. Further details, advisors and related links are below.]


CHISHOLM OIL  | APOLLO | GASTAR  | ARES 

Chisholm Oil and Gas, LLC and Gastar Exploration LLC Announce Strategic Combination to Create the Leading STACK E&P Company

TULSA, Okla. & HOUSTON–June 19, 2019–(BUSINESS WIRE)–Chisholm Oil and Gas, LLC (“Chisholm”) of Tulsa, Oklahoma and Gastar Exploration LLC (“Gastar”) of Houston, Texas announced today that they have entered into definitive agreements to effect a merger between the two companies. The combined company, which will operate under the name Chisholm Oil and Gas and be headquartered in Tulsa, will have net production of approximately 20,000 Boe per day and a combined acreage position of approximately 165,000 net acres, primarily in Kingfisher County, Oklahoma.

Chisholm is currently running three rigs and has a dedicated frac crew. The parties believe that the Gastar assets will be highly synergistic to their upstream operations as well as to Chisholm’s ownership stake in Great Salt Plains Midstream Holdings, LLC and its wholly-owned salt water disposal subsidiary, Cottonmouth SWD, LLC.

The transaction is expected to close in the 3rd quarter of 2019, subject to satisfaction of customary closing conditions.

Chisholm was formed in 2017 with backing from funds managed by certain affiliates of Apollo Global Management, LLC (NYSE: APO) and management. Gastar is owned through private equity funds affiliated with Ares Management Corporation (NYSE: ARES).

Chisholm was advised by Citigroup Inc., as financial advisor, and Vinson & Elkins LLP and Paul, Weiss, Rifkind, Wharton & Garrison, as legal advisors. Evercore and Tudor Pickering Holt & Co. provided financial advisory services to Gastar in connection with the transaction, and Kirkland & Ellis served as legal advisor to Gastar.

About Chisholm Oil and Gas, LLC

Chisholm is a Tulsa, Oklahoma-based exploration and production company focused on acquiring and developing oil and gas assets throughout the STACK play in Blaine, Canadian, Kingfisher, Logan and Major Counties, Oklahoma.

About Gastar Exploration LLC

Gastar is engaged in the exploration, development and production of oil, condensate, natural gas and natural gas liquids in the United States. Specifically, Gastar is focused on the exploration and development of its Mid-Continent assets in the STACK Play in Oklahoma, which includes the Hunton Limestone, Meramec Shale/Mississippi Lime, Woodford Shale, and Osage and Oswego formations.

About Apollo Global Management, LLC

Apollo is a leading global alternative investment manager with offices in New York, Los Angeles, San Diego, Houston, Bethesda, London, Frankfurt, Madrid, Luxembourg, Mumbai, Delhi, Singapore, Hong Kong, Shanghai and Tokyo. Apollo had assets under management of approximately $303 billion as of March 31, 2019 in private equity, credit and real assets funds invested across a core group of nine industries where Apollo has considerable knowledge and resources.

About Ares Management Corporation

Ares Management Corporation is a publicly traded, leading global alternative asset manager with approximately $137 billion of assets under management as of March 31, 2019 and 18 offices in the United States, Europe, Asia and Australia. Since its inception in 1997, Ares has adhered to a disciplined investment philosophy that focuses on delivering strong risk-adjusted investment returns throughout market cycles. Ares believes each of its three distinct but complementary investment groups in Credit, Private Equity and Real Estate is a market leader based on assets under management and investment performance. Ares was built upon the fundamental principle that each group benefits from being part of the greater whole.

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