Calpine Corporation Acquires Sheridan Energy in $41 Million Tender Offer

Calpine Corporation, a leading US power company, has entered into an agreement with Sheridan Energy, Inc. to acquire the latter through a $41 million cash tender offer. The acquisition aims to strengthen Calpine's fuel capabilities and bring expertise in gas exploration and development. The transaction is expected to complete in September 1999, subject to customary conditions.

Key Takeaways:

• Calpine will acquire all outstanding shares of Sheridan's common stock for $5.50 per share, totaling $41 million.
• The acquisition includes 148 billion cubic feet equivalent of proven reserves, with 90% being natural gas, located in strategic markets where Calpine develops low-cost natural gas supplies.
• The reserves are located in northern California and the Gulf Coast region, supporting Calpine's highly efficient, natural gas-fired power plants.
• The transaction will strengthen Calpine's "wellhead-to-burner tip" fuel program, giving the company a stronger competitive advantage as energy markets deregulate.
• Certain Sheridan shareholders have agreed to tender their shares, representing an aggregate of approximately 51% of the outstanding shares.
• The Boards of Directors of Calpine and Sheridan have approved the transaction.
• Calpine has approximately 8,500 megawatts of capacity in operation, under construction, or in announced development in 12 states.

Statistics:

• $41 million: the total value of the tender offer to acquire all outstanding shares of Sheridan's common stock.
• $5.50: the price per share offered by Calpine to acquire Sheridan's common stock.
• 148 billion cubic feet equivalent: the total proven reserves included in the acquisition.
• 90%: the percentage of natural gas reserves included in the acquisition.
• 51%: the approximate percentage of outstanding shares that certain Sheridan shareholders have agreed to tender to Calpine.

Sources:

• SmartPros Business News
• Sheridan Energy, Inc.
• Calpine Corporation