Energy billionaire Harold Hamm agreed to increase his offer to buy Continental Resources, valuing the equity of the US oil producer at about $27bn.
Hamm, one of the pioneers of the US shale revolution of the past two decades, agreed to pay $74.28 a share in cash to buy the 17 per cent of Continental that his family does not already own.
The new offer, announced on Monday, represents a 13 per cent premium to Continental’s closing price in mid-June before Hamm made his first $70 a share bid and will cost the oil tycoon $4.3bn.
However, the transaction will be entirely financed with Continental’s existing cash on its balance sheet and debt, which means Hamm will not be spending any additional money of his own.
The deal, which has been approved by Continental’s board, will bring the Oklahoma City-based company under the full ownership of its founder, who is currently the chair of its board of directors.
Continental Resources, the largest oil producer in the Bakken shale fields in North Dakota and Montana, was badly hit financially during the early days of the coronavirus crisis in 2020, when a slowdown in demand led its market value to drop to $3bn.
Since then the company has been revived partly as a result of Russia’s invasion of Ukraine, which has pushed up energy prices and generated record cash flows as oil and gas prices leapt.
Hamm said in June that it was in the best interest of Continental, which was founded in 1967 and went public in 2007, to be delisted. “We have determined that the opportunity today is with private companies who have the freedom to operate and aren’t limited by public markets, similar to the way that we operated approximately 15 years ago,” he said then in a letter to employees.
Continental shares were up 8.3 per cent in pre-market trading on Monday morning.