An industry-leading renewable natural gas company, Archaea Energy Inc. (NYSE: LFG) inches down 0.62% as the firm signed an agreement with BP Plc (NYSE: BP) to buy it for about $26 per Archaea Class A and Class B share in cash, for a total enterprise value of roughly $4.1 billion, including approximately $800 million in net debt. The cash consideration is a 38% premium to Archaea’s volume weighted average share price for the 30 days ending October 14, 2022.
Archaea’s CEO and Co-Founder, Nick Stork, claimed that the firm was formed with the goal of becoming the world’s leading RNG development company in order to reduce global emissions and achieve multi-generational environmental benefits. They have quickly established a major RNG platform in the United States, and this news will help this firm fulfill its full potential.
He went on to say that BP is a world-class partner and a good match for Archaea, with a strategic focus on bioenergy and an operational history in the RNG value chain that is completely aligned with their and their partners’. They are excited to join them in their aim to expand the role of RNG in assisting customers in meeting their long-term climate goals, and he looks forward to their hard-working staff joining the bp organization to help them meet their bioenergy targets. He is extremely pleased of the Archaea personnel who have led this incredible wealth creation and will continue to lead Archaea’s commitment to stimulate clean energy growth and promote domestic energy dependence.
Chairman of Archaea’s Board, Daniel Rice said that after a thorough review, their Board determined that combining Archaea’s RNG assets and their strong development backlog with bp’s existing bioenergy business and deep operational and financial resources is the best way to create a stronger platform to achieve Archaea’s full potential, while maximizing value for their shareholders.