Chesapeake Energy’s $2.65 Billion Acquisition of Chief E&D Holdings and ffiliates of Tug Hill

Shearman & Sterling advised Chesapeake Energy Corporation in the transaction while Akin Gump Strauss Hauer & Feld LLP represented Tug Hill.

Chesapeake Energy Corporation announced its definitive agreements, along with its subsidiary Chesapeake Appalachia, L.L.C., to acquire 100 percent of the interests of Chief E&D Holdings LP (Chief) and associated non-operated interests held by affiliates of Tug Hill, Inc. Pursuant to the terms of the purchase agreements, the Chesapeake buyers will pay the sellers a purchase price of $2.65 billion, consisting of $2 billion in cash and approximately 9.44 million shares of Chesapeake Energy common stock, subject to customary adjustments.

Chief and Tug Hill hold high quality producing assets and an inventory of premium drilling locations in the prolific Marcellus Shale in Northeast Pennsylvania. The cash portion of the transaction will be financed with cash on hand and the use of the company’s revolving credit facility. The transaction, which is subject to customary closing conditions, including certain regulatory approvals, is expected to close by the end of the first quarter of 2022.

Headquartered in Oklahoma City, Chesapeake Energy’s operations are focused on discovering and responsibly developing its large and geographically diverse resource base of unconventional oil and natural gas assets onshore in the United States.

The Shearman & Sterling team included Jeremy Kennedy (Picture), John M. Craven, Will Johnson, Ben Gris, Bill Nelson, Doreen E. Lilienfeld, Todd Lowther, Jonathan Cheng, John W. Menke, Alicia Bello, Y. Jingjing Liang, Catherine Zachry, Annie Anderson, and Jacquelyn Watson.

The Akin Gump team advising Tug Hill was led by corporate partners Wesley Williams and Cole Bredthauer, and included corporate counsel Eduardo Canales and Sarah Withers, and associate Dominic Riella, and tax partner Alison Chen.

Involved fees earner: Cole Bredthauer – Akin Gump Strauss Hauer & Feld LLP; Eduardo Canales – Akin Gump Strauss Hauer & Feld LLP; Alison Chen – Akin Gump Strauss Hauer & Feld LLP; Dominic Riella – Akin Gump Strauss Hauer & Feld LLP; Wesley Williams – Akin Gump Strauss Hauer & Feld LLP; Sarah Withers – Akin Gump Strauss Hauer & Feld LLP; Annie Anderson – Shearman & Sterling; Alicia Bello – Shearman & Sterling; Jonathan Cheng – Shearman & Sterling; John Craven – Shearman & Sterling; Ben Gris – Shearman & Sterling; Will Johnson – Shearman & Sterling; Jeremy Kennedy – Shearman & Sterling; Jingjing Liang – Shearman & Sterling; Doreen Lilienfeld – Shearman & Sterling; Todd Lowther – Shearman & Sterling; John Menke – Shearman & Sterling; Bill Nelson – Shearman & Sterling; Catherine Zachry – Shearman & Sterling;

Law Firms: Akin Gump Strauss Hauer & Feld LLP; Shearman & Sterling;

Clients: Chesapeake Energy Corporation; Tug Hill, Inc. ;