Baytex Sold Its Eagle Ford For $3.25 Billion - Here's What It Might Buy Next
A look at how Baytex can unlock material upside and de-risk through a strategic acquisition, while delivering a meaningful premium to the target’s shareholders.
Baytex Energy ($BTE) recently sold its Eagle Ford assets for $3.25 billion (US$2.3 billion), marking a full exit from the U.S. Baytex is now a pure-play Western Canadian producer focused on its heavy oil assets and its Pembina Duvernay position. Baytex management plans to use the proceeds to pay off debt, buy back shares and grow its Canadian oil production business.
I think this is a good move for Baytex, a company I’ve followed for years. Back in April 2021, I built a meaningful position in Baytex’s stock and wrote about its early Clearwater results - before the market noticed. BTE stock went on to rally more than 300% over the next year!
Now, I think Baytex now has another major opportunity in front of it. There’s a company in a core area for Baytex that I’ve written about recently which, if Baytex were to acquire it at a premium, would offer substantial financial and strategic upside for Baytex while also delivering a healthy premium to the target company’s shareholders - presenting a clear win-win for both sides.
