Acquirer: Canada Pension Plan Investment Board (Canada); Encino Energy (U.S.)
Acquired: Utica Shale operations of Chesapeake Energy Corp. (U.S.)
Value: $2 billion
Industry Tags: Energy; Oil & Gas; Infrastructure
On July 26, 2018, Chesapeake Energy Corp., a publicly traded (NASDAQ: CHK) oil exploration company, “entered into an agreement to sell its interests in the Utica Shale operating area located in Ohio for approximately $2.0 billion to Encino Acquisition Partners, a private oil and gas company headquartered in Houston, Texas,” which was conditioned on CFIUS clearance. (Chesapeake Energy Corp. Press Release, Chesapeake Energy Corporation Agrees To Sell Utica Shale Position For $2.0 Billion, Provides Powder River Basin Update And 2018 Updated Guidance, July 26, 2018; see Section 7.1.6.,Purchase and Sale Agreement, Chesapeake Energy Corp. Form 10-Q, Ex-2.1, Oct. 30, 2018, SEC Filing.) “Encino Energy is backed by the third-largest pension fund in the world, the Canada Pension Plan Investment Board (CPPIB).” (Encino Energy, About Us web page, visited May 3, 2021.) CPPIB and Encino “formed EAP in 2017 to acquire large, high-margin oil and gas production and development assets in the U.S. lower 48 states. In support of this acquisition, CPPIB will invest approximately US$1.0 billion in EAP and will own approximately 98% of the partnership. Houston-based Encino will invest in EAP alongside CPPIB and will operate the acquired assets on behalf of EAP.” (Canada Pension Plan Investment Board Press Release, Encino Acquisition Partners Agrees to Acquire Ohio Utica Shale Properties for US$2.0 Billion, July 26, 2018.) On October 26, 2018, Chesapeake Energy Corp. received “CFIUS’s approval of the Utica Sale . . .” (Chesapeake Energy Corp. Form S-4, Dec. 5, 2018, SEC Filing.)
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