Yuma Energy (NYSE:YUMA) announced it has agreed a deal with private firm Davis Petroleum Acquisition in an all-stock merger.
The deal, which is subject to the approval of stockholders of both companies, will see Davis become a wholly owned subsidiary of Yuma.
Davis has no bank debt around $4.1mln in cash, and produced 1,533 average barrels of oil equivalent per day (BOE/d) in the fourth quarter of 2015.
Sam Banks, chairman and chief executive of Yuma, said: “This transaction truly represents a scenario where the whole is greater than the sum of its parts, and is anticipated to increase our proved reserves by approximately 4.8 million barrels of oil equivalent at year end 2015, and to substantially increase our net daily production by approximately 1,500 barrels of oil equivalent per day based on Davis' fourth quarter 2015 production rates.”
Michael Reddin, chairman, president and chief executive of Davis, added: “We are excited about the combination and the resulting synergies that this merger will bring, creating value for both companies.”