June 10, 2019 / 11:23 AM / 2 months ago

UPDATE 1-Comstock Resources to acquire Covey Park in $2.2 billion deal

(Adds details on deal, shares)

June 10 (Reuters) - Comstock Resources Inc said on Monday it would buy privately held natural gas company Covey Park in a deal valued at about $2.2 billion, including debt, to strengthen its position in the Haynesville shale basin.

The cash-and-stock deal would raise Comstock's net production to more than 1.1 billion cubic feet equivalent per day, the company said.

Dallas-based billionaire Jerry Jones, who first invested in Comstock in April last year, will infuse an additional $475 million in cash for 50,000,000 of newly issued shares of Comstock common stock.

The additional equity investment brings Jerry Jones' total investment in Comstock to about $1.1 billion.

Natural gas output at Haynesville, located in northern Louisiana and eastern Texas, is projected to be the second fastest-growing among shale basins this month, according to U.S. Energy Information Administration.

Wells Fargo Securities, LLC and BMO Capital Markets are financial advisers to Comstock.

Comstock's shares were up ~13% at $5 in premarket trading.

Reporting by Arundhati Sarkar in Bengaluru; Editing by Anil D'Silva and Sriraj Kalluvila

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