Magnolia Oil & Gas Corporation has entered into a definitive purchase agreement to acquire WildFire Energy for approx. $4.06 billion, inclusive of WildFire’s debt and subject to customary purchase price adjustments. The Acquisition has been unanimously approved by Magnolia’s board of directors.

'The acquisition of the WildFire oil and gas properties and acreage is a natural and strategic fit and most notably, it makes our business better by extending our runway of advantaged profitability and significant free cash flow generation,' said Magnolia’s Chairman, President and CEO Chris Stavros. 'This transaction is the culmination of our extensive subsurface understanding, experience, and the demonstration of our proven resource capture in the Giddings field. With more than 1.25 million net acres and upside development opportunities across multiple benches including the Austin Chalk, Eagle Ford and Woodbine, this transaction creates a premier position in South Texas by combining two high-quality and complementary assets near Gulf Coast markets which offer premium pricing for our products. As we are acquiring a large position with similar financial and operating characteristics that we understand well, importantly this allows Magnolia to continue to execute on its differentiated and successful business model.'

'The combination of our technical understanding of Giddings and our strong balance sheet put us in a unique position to execute on larger M&A in our own backyard. WildFire is not only a hand in glove fit for Magnolia, but it also offers unmatched benefits while meeting several important characteristics we look for – focused, high-quality assets with concentrated scale, a low capital reinvestment rate providing moderate production growth, high operating margins, and steady free cash flow allowing for consistent and significant shareholder returns. WildFire has a large, low-decline oily PDP base with historic development centered on the Eagle Ford. While there are significant future Eagle Ford development opportunities, our technical teams see extensive future potential in the Austin Chalk with further upside in the Woodbine as well as other appraisal opportunities that should expand on our success in Giddings since 2018.

'Together with the acquired WildFire assets, Magnolia’s adjacent and overlapping acreage creates a larger, contiguous position with additional infrastructure benefits, estimated to provide at least $100 million in cost savings and annual synergies that enhance our free cash flow. We expect the transaction to be immediately and highly accretive to our key per share financial metrics including cash flow, free cash flow and earnings, in addition to enhancing our D&C capital reinvestment rate. Our strong confidence in the high-quality and capability of the WildFire assets and higher free cash flow generation supports improved shareholder returns driving an immediate increase of 9 percent in our quarterly dividend to 18 cents per share, payable in the third quarter of this year. The combination of these two high-quality businesses improves our position for sustained growth, strengthens our financial returns, and increases our dividend-per-share payout capacity, creating improved long-term value for our shareholders.'

Strategic, Operational and Financial Benefits

Magnolia Second Quarter 2026 Operations Update

Magnolia’s second quarter total production averaged 106.1 Mboe/d with oil production of 41.9 Mbo/d. D&C capital for the second quarter was $125 million, and the Company ended the quarter with $296 million of cash on the balance sheet. Based on Magnolia’s strong second quarter production, the Company is increasing its full year 2026 annual production growth guidance (Magnolia standalone) to 6 percent from 5 percent.

Further details on the impact of the Acquisition to Magnolia’s 2026 production and capital spending will be provided after closing, which is expected to occur late in the third quarter of 2026.

Transaction Details

Under the terms of the agreement, the transaction is valued at approximately $4.06 billion. WildFire owners will receive 32.2 million shares of Magnolia’s Class A Common Stock and Magnolia is assuming WildFire’s $600 million of outstanding notes due in 2029. The Company intends to fund the remaining amount through a combination of cash on hand, and a balanced mix of debt and new Common equity. Magnolia has obtained committed financing from JPMorgan Chase Bank, N.A., Citigroup Global Markets Inc. and Wells Fargo Bank, N.A. in connection with this transaction and has amended and increased the Company’s secured credit facility to a $2 billion borrowing base and with elected commitments of $1.75 billion contingent upon closing the transaction.

Advisors

In connection with this transaction, Magnolia has retained J.P. Morgan Securities LLC and Moelis & Company LLC as lead financial advisors and Citigroup as a financial advisor. Kirkland & Ellis LLP acted as Magnolia’s legal advisor. WildFire has retained Jefferies LLC as lead financial advisor and BofA Securities, Inc. as a financial advisor. Troutman Pepper Locke acted as WildFire’s legal advisor.

About Magnolia Oil & Gas

Magnolia (MGY) is a publicly traded oil and gas exploration and production company with operations primarily concentrated in South Texas in the core of the Eagle Ford Shale and Austin Chalk formations. Magnolia focuses on generating value for shareholders by delivering steady, moderate annual production growth resulting from its disciplined and efficient philosophy toward capital spending. The Company strives to generate high pre-tax operating margins and consistent free cash flow allowing for strong cash returns to our shareholders. For more information, visit www.magnoliaoilgas.com.

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Source: Magnolia Oil & Ga