425: ISS and Glass Lewis Recommend Crescent Energy and SilverBow Resources Shareholders Vote FOR Proposed Merger

Leading proxy advisory firms ISS and Glass Lewis recommend that shareholders of both Crescent Energy and SilverBow Resources vote in favor of the proposed merger.

Summary

• Crescent Energy Company announced that Institutional Shareholder Services (ISS) and Glass Lewis & Co. have recommended that Crescent shareholders vote FOR the approval of the issuance of shares of Crescent Class A common stock in connection with the company's pending merger with SilverBow Resources, Inc.
• ISS and Glass Lewis have also recommended that SilverBow shareholders vote FOR the adoption of the merger agreement.
• The Crescent special meeting of stockholders to vote on matters relating to the proposed merger is scheduled for July 29, 2024.
• Shareholders of record as of June 28, 2024, are entitled to vote.
• Crescent is focused on delivering value for shareholders through acquisitions and consistent return of capital.

Sentiment

Score: 8

Explanation: The document conveys a positive sentiment due to the recommendations from ISS and Glass Lewis, which increases the likelihood of shareholder approval for the merger. The focus on synergies and attractive returns further contributes to the positive outlook.

Positives

• The recommendations from ISS and Glass Lewis reinforce the belief that the transaction with SilverBow is in the best interests of Crescent and its shareholders.
• The merger is expected to strengthen Crescent's position as a leading operator in the Eagle Ford.
• Crescent anticipates creating meaningful opportunity for significant efficiencies and attractive returns through the merger.

Risks

• The expected timing and likelihood of completion of the Transaction.
• The ability to successfully integrate the businesses.
• The occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement.
• The possibility that stockholders of Crescent may not approve the issuance of new shares of common stock in the Transaction or that stockholders of SilverBow may not approve the adoption of the Merger Agreement.
• The risk that the parties may not be able to satisfy the conditions to the Transaction in a timely manner or at all.
• Risks related to disruption of management time from ongoing business operations due to the Transaction.
• The risk that any announcements relating to the Transaction could have adverse effects on the market price of Crescent's common stock or SilverBow common stock.
• The risk that the Transaction and its announcement could have an adverse effect on the ability of Crescent and SilverBow to retain customers and retain and hire key personnel and maintain relationships with their suppliers and customers and on their operating results and businesses generally.
• The risk the pending Transaction could distract management of both entities and they will incur substantial costs.
• The risk that problems may arise in successfully integrating the businesses of the companies, which may result in the combined company not operating as effectively and efficiently as expected.
• The risk that the combined company may be unable to achieve synergies or it may take longer than expected to achieve those synergies and other important factors that could cause actual results to differ materially from those projected.

Future Outlook

The merger aims to strengthen Crescent's position in the Eagle Ford and create opportunities for efficiencies and attractive returns.

Management Comments

• Crescent CEO David Rockecharlie stated that the transaction with SilverBow is in the best interests of the company and its shareholders.
• Rockecharlie believes the combined company will strengthen its position as a leading operator in the Eagle Ford.

Industry Context

The announcement reflects ongoing consolidation trends in the oil and gas industry, particularly in shale basins like the Eagle Ford, where companies are seeking to enhance scale and efficiency.

Comparison to Industry Standards

• Proxy advisory firms like ISS and Glass Lewis play a crucial role in influencing shareholder votes on major corporate transactions.
• Their recommendations are often based on an assessment of the strategic rationale, financial terms, and governance implications of the deal.
• Similar mergers in the energy sector, such as ExxonMobil's acquisition of Pioneer Natural Resources, have also been subject to scrutiny and recommendations from proxy advisory firms.

Stakeholder Impact

• Shareholders of both Crescent and SilverBow are impacted by the proposed merger and will vote on the transaction.
• Employees of both companies may be affected by the integration of the businesses.
• Customers and suppliers may experience changes as a result of the merger.

Next Steps

• Crescent shareholders will vote on the issuance of shares at the special meeting on July 29, 2024.
• SilverBow shareholders will vote on the adoption of the merger agreement.
• The companies will work to satisfy the conditions to the transaction and complete the merger.

Key Dates