Southwestern Energy Co.
rose 0.9% in premarket Wednesday after the oil and gas company announced an agreement to buy Indigo Natural Resources LLC for $ 2.7 billion. The deal with Indigo, the third largest privately-owned natural gas producer in the United States, is expected to close in the fourth quarter of 2021. The total deal value will include $ 400 million in cash, $ 1.6 billion in Southwestern stock and $ 700 million. an estimated 5.375% senior debt due in 2029. Southwestern said the deal would increase cumulative free cash flow to $ 1.2 billion from 2021 to 2023 and boost net production to over 4 billion cubic feet of equivalent (Bcfe) per day, made up of 85% natural gas. The company expects cost synergies to be around $ 20 million. Southwestern shares gained 93.0% YTD to Tuesday, while S&P 500