Independent US gas producer Quest Resources has terminated its merger agreement with Pinnacle Gas Resources, the companies said Monday
Independent US gas producer Quest Resources has terminated its merger agreement with Pinnacle Gas Resources, the companies said Monday.
Under terms of the deal, either side could cancel the transaction if it was not closed by May 16. Quest is not required to pay a termination fee.
The companies did not say why the deal was not closed by the deadline.
The companies announced the merger last October. Financial terms called for Pinnacle stockholders to receive 0.6584 shares of Quest common stock for each share of Pinnacle common stock owned. Based on the closing market prices for the shares of both companies at the time, the combined company would have had an equity market capitalization of about $450 million.
Separately, Quest said its wholly owned New Ventures group has signed a letter of intent with a private company to enter into a farm-out agreement that would give it the right to develop roughly 30,000 net acres in Pennsylvania for a one-year period. The initial cost of the deal is $4
million, and Quest will have the option to acquire all of the acreage at the end of the farm-out period for an additional $6.5 million.