Onshore oilfield developer Encore Acquisition Co said it would acquire oil and gas properties in the mid-continent and East Texas from EXCO Resources Inc for $375 million in cash.
The company said it would fund the acquisition partly from its sale of properties in Rockies and Permian basin to oil and gas company Encore Energy Partners LP for $190 million, and from borrowings under its credit facility.
Encore Energy was formed by Encore Acquisition to acquire oil and gas propetries.
Separately, Encore Energy Partners said its acquisition of properties in Rockies and the Permian would be accretive to its distributable cash flow per unit.
Encore Energy said its annualized distribution rate will increase to $2.15 per unit from $2.05 per unit begenning from the third quarter.
The company also said it plans to make a public offering of 8.2 million common units, the net proceeds of which will be used to fund a portion of its acquisition.
Shares of Encore Acquisition closed at $29.84, while those of Encore Energy closed at $15.55 Friday on the New York Stock Exchange.
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