Quicksilver Rises After Selling Stake in Texas ShaleMike Lee
Quicksilver Resources Inc. rose the most in two weeks after the company agreed to sell a 25 percent stake in Barnett Shale assets to Tokyo Gas Co. for $485 million, more than its market value.
Quicksilver gained 16 percent to $2.60 at the close in New York, the most since March 14, after earlier rising as much as 41 percent.
Proceeds from the sale will be used to pay down some of Quicksilver’s $2 billion debt, the Fort Worth, Texas-based company said in a March 29 statement. The sale price was more than the company’s $397 million market value as of March 28.
It was also a third higher than predicted, analysts at investment bank Tudor, Pickering, Holt & Co. wrote in a note to clients today.
More than 76 percent of Quicksilver’s daily average gas production last year came from the Barnett Shale and the company expects about two-thirds of 2013 output from the area in north Texas, according to its annual report. Quicksilver held 127,000 net acres in the Barnett Shale at the end of 2012.
Quicksilver has been seeking joint venture partners to help pay for drilling costs after U.S. gas prices fell to a 10-year low last year.