425: Berry Corp. Merger with CRC Clears HSR Antitrust Hurdle

Berry Corporation's pending merger with California Resources Corporation has cleared the Hart-Scott-Rodino antitrust waiting period, moving closer to completion.

Summary

• The required waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 expired at 11:59 p.m. Eastern Time on November 10, 2025.
• This expiration is a significant step towards the pending combination where Berry Corporation (bry) will become a direct, wholly-owned subsidiary of California Resources Corporation (CRC).
• Consummation of the Merger remains subject to other customary conditions.
• Remaining conditions include Berry shareholder approval of the Merger and prior authorization by the U.S. Federal Energy Regulatory Commission (FERC) under Section 203 of the U.S. Federal Power Act.

Sentiment

Score: 7

Explanation: The expiration of the HSR waiting period is a positive and expected step towards the completion of the merger, reducing a significant regulatory uncertainty. While other conditions remain, this moves the transaction forward.

Positives

• The expiration of the Hart-Scott-Rodino waiting period removes a key regulatory hurdle for the merger, indicating progress towards completion.
• This development reduces uncertainty regarding antitrust approval for the transaction.

Risks

• Transaction costs associated with the merger.
• Potential unknown liabilities arising from the combination.
• Adverse effects on the market price of Berry's or CRC's common stock due to merger-related announcements.
• Challenges in successfully integrating the businesses of Berry and CRC.
• Difficulty or longer-than-expected time to achieve projected synergies from the merger.
• Risks related to financial community and rating agency perceptions of Berry, CRC, or the combined entity.
• Potential impact of general economic, political, and market factors on Berry, CRC, or the Merger.
• The possibility of an event, change, or circumstance leading to the termination of the Merger agreement.
• Risk that Berry stockholders may not approve the Merger.
• Disruption of management time from ongoing business operations due to the Merger process.
• Effects of the announcement, pendency, or completion of the Merger on the ability of Berry and CRC to retain customers, key personnel, and maintain relationships with suppliers and customers.
• Risk that other closing conditions, including necessary regulatory approvals, may not be satisfied in a timely manner or may be subject to unanticipated conditions.

Future Outlook

The merger is expected to proceed, with management anticipating benefits, future financial position, and operating results for the combined entity. However, these forward-looking statements are subject to numerous risks and uncertainties, including transaction costs, integration challenges, and market perceptions.

Management Comments

• Management of Berry and CRC base their forward-looking statements on current beliefs and expectations, acknowledging that actual results could differ materially due to various risks and uncertainties.

Industry Context

This announcement is specific to a corporate merger within the oil and gas industry, indicating ongoing consolidation trends as companies seek scale, operational efficiencies, or strategic positioning. The clearance of an antitrust hurdle is a standard, yet critical, step in such large-scale transactions.

Stakeholder Impact

• Shareholders of Berry Corporation will need to approve the merger, which will result in Berry becoming a wholly-owned subsidiary of California Resources Corporation, impacting their ownership structure.
• Employees of both companies may face integration challenges and potential changes in roles or organizational structure post-merger.
• Customers and suppliers of Berry and CRC may experience changes in relationships or terms as the combined entity integrates operations.
• Regulatory bodies, specifically FERC, still need to provide authorization, indicating ongoing oversight.

Next Steps

• Berry shareholders must approve the Merger.
• The U.S. Federal Energy Regulatory Commission (FERC) must provide prior authorization under Section 203 of the U.S. Federal Power Act.
• Berry and CRC may file other documents with the SEC in connection with the Merger.

Key Dates

Recommendation

The HSR clearance is a positive step, but the merger is not yet complete, with shareholder and FERC approvals still pending. The filing highlights numerous risks associated with the merger, including integration challenges and potential market price volatility. Investors should hold pending further developments and a clearer picture of the combined entity's prospects and the successful resolution of remaining conditions.

Keywords

Berry Corporation, California Resources Corporation, Merger, Acquisition, HSR Act, Antitrust, Regulatory Approval, Oil and Gas, Energy, Corporate Action