Crescent Energy Company and Vital Energy have entered into a definitive agreement pursuant to which Crescent will acquire Vital in an all-stock transaction valued at approximately $3.1 billion, inclusive of Vital’s net debt. The Transaction will establish a top 10 independent with a consistent and free cash flow focused strategy, scaled positions and flexible capital allocation across premier basins. The combined company will be led by a management team and Board with deep operating and investing expertise, well-positioned to drive long-term growth and value creation.
Under the terms of the Merger Agreement, Vital shareholders will receive 1.9062 shares of Crescent Class A common stock for each share of Vital common stock, representing a 5% premium to the 30-day volume weighted average price ('VWAP') exchange ratio and a 15% premium to Vital’s 30-day VWAP as of August 22, 2025.
The Transaction Offers Compelling Value for All Shareholders:
- Attractive Acquisition Returns and Significant Accretion - Strong cash-on-cash investment returns with valuation covered by existing production base; highly accretive across CFFO, FCF and NAV per share; $90 - $100 MM of immediate annual synergies with potential for significant incremental operating efficiencies.
- Consistent Strategy Focused on Free Cash Flow and Attractive Returns - Crescent to implement lower activity, higher free cash flow business plan to align assets with its consistent strategy; high-graded capital allocation improves investor returns and supports peer-leading dividend.
- Enhances 'Investment Grade' Quality Balance Sheet - Leverage accretive business plan plus ~$1 BN pipeline of non-core divestitures; creates largest liquids-weighted producer without IG status(1) .
- Strengthens Leading Growth Through Acquisition Platform - Consistent investment and operational underwriting; >$60 BN of opportunity surrounding the combined footprint.
- Pro Forma Crescent is a Top 10 Independent - Scaled and focused asset portfolio with flexible capital allocation across more than a decade of high-quality inventory in the Eagle Ford, Permian and Uinta Basins.
'This transaction is transformative for Crescent and consistent with our strategy,' said John Goff, Crescent’s Chairman of the Board. 'Crescent’s impressive trajectory of returns-driven growth through M&A has cemented the company as a top ten independent, with line of sight to an investment grade credit rating. Acquiring Vital and executing on an attractive pipeline of non-core divestitures sharpens our focus and expands our opportunity set for accretive future growth.'
Crescent CEO David Rockecharlie said, 'This combination represents compelling value for all shareholders, with attractive acquisition returns and significant accretion across all key financial metrics. We’ve always had a free cash flow focused strategy, and our model applied to these assets creates sustainable value for all shareholders. With this acquisition and our $1 billion non-core divestiture pipeline, we are better positioned than ever before. Crescent will have more focus, more scale and more potential to deliver long-term value to shareholders.'
Vital CEO Jason Pigott added, 'Today’s announcement recognizes the value we have created at Vital Energy. Our combination with Crescent Energy will create a premier, scaled, mid-cap operator with significant efficiencies across a larger asset base. The combined businesses will have more capital allocation flexibility across a vast development inventory and the ability to immediately transfer best operating practices across basins. Strong free cash flow generation will maintain a premier balance sheet and drive sustainable capital returns to shareholders. We are confident that this deal is the right move for Vital shareholders, and it recognizes the hard work and dedication of all Vital employees over the last six years.'
Transaction Details
Under the terms of the Merger Agreement, Vital shareholders will receive 1.9062 shares of Crescent Class A common stock for each share of Vital common stock. Following the consummation of the Transaction, Crescent shareholders will own approximately 77% of the combined company and Vital shareholders will own approximately 23% of the combined company, on a fully diluted basis.
Timing and Approvals
The Transaction has been unanimously approved by the boards of directors of both companies and unanimously approved by a special committee of independent directors of Crescent (the 'Special Committee'). Current Crescent and Vital shareholders representing approximately 29% and 20% of total common shares outstanding, respectively, are party to voting and/or existing investor agreements serving to support the Transaction in line with the unanimous recommendation of both Boards. The Transaction, which will be subject to customary closing conditions, including approvals by shareholders of Crescent and Vital and typical regulatory agencies, is targeted to close by year-end 2025.
Governance
After closing of the Transaction, the Crescent board of directors will increase to 12 members with the addition of 2 directors to be designated by Vital. John Goff will continue to serve as Non-Executive Chairman and David Rockecharlie will continue to serve as Chief Executive Officer of the combined company. Crescent will remain headquartered in Houston.
Advisors
Jefferies LLC is serving as lead financial advisor to Crescent. Evercore is also serving as a financial advisor to Crescent. Kirkland & Ellis LLP is serving as Crescent’s legal counsel.
Intrepid Partners, LLC is serving as financial advisor to the Special Committee. Richards, Layton & Finger, P.A. is serving as counsel for the Special Committee.
Houlihan Lokey and J.P. Morgan Securities LLC are serving as joint financial advisors to Vital. Vinson & Elkins LLP is serving as Vital’s legal counsel. Lazard is serving as an independent financial advisor.
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Source: Crescent Energy
