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Upstream: Corporate Finance: Purchase Price Allocation

Midstates Petroleum Company, Inc. (Midstates) is an independent exploration and production company focused on the application of modern drilling and completion techniques to oil/liquids-prone resources in previously discovered, yet underdeveloped hydrocarbon trends. Midstates is headquartered in Houston, Texas, with a regional office in Tulsa, Oklahoma. Midstates engaged Opportune’s Corporate Finance team to perform a valuation of assets worth $1.27 billion worth in connection with two transactions.

Opportune’s experienced experts conducted valuation analysis in connection with two acquisitions by Midstates. Opportune allocated the purchase price for financial reporting purposes, in accordance with GAAP accounting standards, and they allocated the value to the relevant reserve classes, based on third-party engineering studies. Our team also developed a price deck and a fundamental long-term outlook, calculated a weighted average cost, and concluded on the fair value of the acquired reserves with respect to both transactions. Midstates’ auditors reviewed the valuation and considered a reasonable indication of value, which was thereafter included in the Midstates financial statements.

The Opportune corporate finance team focuses on transaction advisory and valuations. We offer our clients the knowledge and resources that come from a seasoned energy industry finance staff. We understand the increasing complexities of energy industry valuations, and perform advanced analytics of derivatives, securities, equity instruments, debt instruments, and corporate deal structures. For additional information, click here.

Dean Price

PartnerOpportune LLP