425: Berry-CRC Merger Update: Approvals & Closing Timeline

Berry Corporation provides employees with an update on the CRC merger, detailing required approvals and an expected closing timeline of late 2025 to Q1 2026.

Summary

• Berry Corporation (bry) and California Resources Corporation (CRC) are progressing towards completing their merger, which includes Berry's subsidiaries Macpherson and C&J Well Services.
• The legal close process involves several key approvals: Federal Energy Regulatory Commission (FERC) review, Hart-Scott-Rodino (HSR) Act anti-trust clearance from the Federal Trade Commission, and approval by Berry shareholders.
• HSR clearance is expected in November 2025.
• Berry shareholders are scheduled to vote on the merger at a special meeting on December 15, 2025.
• FERC approval is anticipated to be the longest process.
• The legal close is currently expected in January 2026, with a possibility of occurring as early as the latter half of December 2025 or extending into the first quarter of 2026.
• The Integration Management Office (IMO) is targeting mid-December 2025 for "Day 1 readiness" to ensure an efficient and smooth close.
• Upon closing, ownership of Berry companies will transfer to CRC, and Berry employees will formally become part of the CRC organization, though employer entities and systems may remain separate for a period.

Sentiment

Score: 7

Explanation: The filing provides a positive update on the ongoing merger process, indicating progress towards completion and active integration planning. While it acknowledges potential delays and lists numerous risks, the overall tone is one of confident progression towards the expected close.

Positives

• The merger process between Berry and CRC is actively progressing towards completion.
• Integration planning is underway, with the Integration Management Office (IMO) targeting mid-December 2025 for "Day 1 readiness."
• HSR clearance is expected in November 2025, indicating progress on a key regulatory approval.
• A specific date, December 15, 2025, has been set for Berry shareholder approval, providing clarity on the timeline.

Risks

• Transaction costs associated with the merger.
• Unknown liabilities that may arise post-merger.
• Adverse effects on the market price of Berry's or CRC's common stock due to merger announcements.
• Challenges in successfully integrating the businesses of Berry and CRC.
• Difficulty or extended time required 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 the companies or the transaction.
• The occurrence of any event, change, or circumstance that could lead to the termination of the proposed transaction.
• The risk that Berry stockholders may not approve the proposed transaction.
• Disruption of management time from ongoing business operations due to the proposed transaction.
• Effects of the announcement, pendency, or completion of the transaction on the ability to retain customers, hire key personnel, and maintain relationships with suppliers and customers.
• The risk that any closing conditions may not be satisfied in a timely manner, including regulatory approvals not being obtained or being subject to unanticipated conditions.

Future Outlook

The merger between Berry Corporation and California Resources Corporation is progressing, with key regulatory and shareholder approvals anticipated in late 2025. The legal close is expected in January 2026, though it could occur as early as late December 2025 or extend into the first quarter of 2026. Integration planning is actively underway, targeting mid-December for "Day 1 readiness." Further updates on milestones and timelines will be communicated as they become clearer.

Management Comments

• "As we move toward completing the merger between CRC and Berry, we want to provide an overview of the key legal and regulatory steps that must be completed before the transaction officially closes."
• "We currently expect that once all of the required approvals are complete, we will promptly move to legally close the transaction."
• "At that moment, ownership of the Berry companies (including the Macpherson and C&J companies) will officially transfer to CRC, and all of those companies will continue to exist and operate as part of one combined organization within CRC."
• "For purposes of our joint integration planning, the Integration Management Office (IMO) is using mid-December as the target to reach Day 1 readiness, as that is the earliest possible timeline by which the transaction could close."
• "Preparing for Day 1 readiness by mid-December positions us to be ready for an efficient and smooth close, on an accelerated timeline, once all of the approvals are in hand and we can set a closing date."
• "We will continue to update you as the milestones and timeline to close become clearer."

Industry Context

This merger represents a consolidation within the U.S. energy sector, specifically involving oil and gas exploration and production companies (Berry and CRC) and related services (C&J Well Services). Such mergers are common in mature industries seeking economies of scale, operational efficiencies, and enhanced market position, especially in response to market volatility or strategic shifts.

Stakeholder Impact

• Shareholders (Berry): Required to approve the merger, and the transaction will result in their ownership transferring to CRC. The market price of their common stock could be affected by announcements.
• Employees (Berry, Macpherson, C&J): Will formally become part of the CRC organization upon closing, though their direct employer and systems may remain separate for a period. There's a risk of disruption and potential impact on retention of key personnel.
• Customers and Suppliers: The ability to retain customers and maintain relationships with suppliers could be affected by the transaction.
• Regulatory Authorities (FERC, FTC): Involved in the approval process, which is a critical condition for the merger's completion.

Next Steps

• Continue to update employees as milestones and the timeline to close become clearer.
• Circulate another set of Frequently Asked Questions (FAQs) within the next week.
• Post FAQs on the Berry sharepoint/intranet.
• Employees can send additional questions or concerns to imo@bry.com or raise them directly to the Executive Leadership Team.

Key Dates

Recommendation

The filing provides an update on the procedural aspects and expected timeline of an already announced merger. It does not introduce new financial performance data or significant strategic shifts that would warrant a change in investment thesis beyond the merger itself. Investors would likely maintain their current position, awaiting the finalization of the transaction and the subsequent integration, while carefully monitoring the identified risks and potential for delays.

Keywords

Berry Corporation, California Resources Corporation, CRC, Merger, Acquisition, SEC Filing, Corporate Governance, Shareholder Approval, Regulatory Approval, FERC, HSR Act, Oil and Gas, Energy Sector, Transaction Update