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BONANZA CREEK Bonanza Creek and Extraction to Combine in Merger of Equals , Creating Civitas Resources - a New Colorado Energy Leader and the State's First Net - Zero Oil & Gas Producer May 10 , 2021 DENVER , May 10 , 2021 ( GLOBE NEWSWIRE ) -- Bonanza Creek Energy , Inc. ( NYSE : BCEI ) ( " Bonanza Creek " ) and Extraction Oil & Gas , Inc. ( NASDAQ : XOG ) ( " Extraction " ) , today announced that they have entered into a definitive agreement to combine in an all - stock merger of equals . The combined company , to be named Civitas Resources , Inc. ( " Civitas " ) , will be the largest pure - play energy producer in Colorado's Denver - Julesburg ( DJ ) Basin , with an aggregate enterprise value of approximately $ 2.6 billion ( based on the closing share prices of Bonanza Creek and Extraction on May 7 , 2021 ) . TRANSACTION HIGHLIGHTS • The merger will create a leading energy producer in Colorado's DJ Basin , a basin characterized by low operating costs , extensive infrastructure , ample takeaway , multiple producing horizons and responsible energy production . • The combined company will operate across approximately 425,000 net acres , with a production base of 117 thousand barrels of oil equivalent per day ( 117 Mboe / d , on a pro forma 1Q21 production basis ) . • The transaction is expected to be significantly accretive to free cash flow and other per - share metrics . • At closing , Civitas is projected to be one of most well - capitalized companies in the industry , with a leverage ratio below 0.3x pro forma 1Q21 Net Debt / 2021E EBITDA . • Civitas expects to achieve annual expense and capital savings of approximately $ 25 million . • Bonanza Creek's recently announced annual dividend of $ 1.40 per share is expected to be increased by Civitas to $ 1.60 per share effective at closing , with such increase representing a distribution of approximately half of the transaction synergies to Civitas ' shareholder base . • Bonanza Creek President and Chief Executive Officer , Eric Greager , will serve as President and CEO of Civitas . Other senior leadership positions will be filled by current executives of Bonanza Creek and Extraction . • Extraction Chairman of the Board , Ben Dell , will serve as Chairman of Civitas , and each of Bonanza Creek and Extraction will nominate four directors to Civitas ' diverse , eight - member Board . • Civitas will take to the next level an E & P business model that has been actively embraced by both Bonanza Creek and Extraction , defined by operational discipline , a strong balance sheet , commitment to free cash flow generation , financial alignment with stakeholders , environmental and community leadership , and best - in - class governance . • At closing , Civitas will be Colorado's first net - zero oil and gas producer ( scope 1 and scope 2 ) through an intensive , continuing focus on reducing operational emissions and a multi - year investment in certified emissions offsets . CEO COMMENTARY " Successful E & P operators will be those who place a priority on disciplined capital deployment , deliver operational and cost excellence , maintain a relentless focus on shareholder value , and have governance standards that are aligned with the times , " said Eric Greager , President and Chief Executive Officer of Bonanza Creek . “ Bonanza Creek and Extraction each bring a demonstrated commitment to these principles , as well as shared organizational and community values . Together , as Civitas , we will embody an E & P business model ideally suited to deliver for all of our stakeholders . " " We believe the combination of Bonanza Creek and Extraction will create one of the most durable , profitable , and progressive producers in the DJ Basin , with premium assets at the front end of the cost curve , " said Tom Tyree , Chief Executive Officer of Extraction . " Collectively , we will create significant value for all stakeholders as we will become Colorado's first net - zero oil and gas producer through the continuing reduction in operational emissions coupled with a multi - year investment in certified emissions offsets . " TRANSACTION DETAILS Under the terms of the definitive merger agreement , Extraction shareholders will receive a fixed exchange ratio of 1.1711 shares of Bonanza Creek common shares for each share of Extraction common stock owned on the closing date . Based on the exchange ratio and the closing price of Bonanza Creek's common stock on May 7 , 2021 , Civitas would have an aggregate enterprise value of approximately $ 2.6 billion . Upon completion of the transaction , Bonanza Creek and Extraction shareholders will each own approximately 50.0 % of Civitas , both on a fully diluted basis . The transaction , which is expected to close in the third quarter of 2021 , has been unanimously approved by the boards of directors of both companies . Funds managed by Kimmeridge Energy own approximately 38 % percent of the outstanding shares of Extraction and have entered into a support agreement to vote in favor of the transaction . The closing of the merger is subject to customary closing conditions , including approvals by Bonanza