Sources say that WildFire Energy owners are looking to sell the US shale operator for $4 billion or more.

Investment firms 'Warburg Pincus' and 'Kayne Anderson" are exploring the possibility of selling WildFire Energy. Any deal is expected to be worth a lot more than $4 billion, including debt. People familiar with the matter say that the shale company is valued at more than $4 billion, including debt. This move is made at a time of rising crude oil prices, as U.S. benchmark price for oil has risen above $100 per barrel in this week due to conflict in the Middle East. The disruption to the energy markets and wider global economy is significant. However, the increased value of energy production assets, as well as the higher commodity prices has made it a good time to sell.

WildFire Energy, according to their website, is one of the largest private operators in South Texas' Eagle Ford shale, with a daily production rate of around 50,000 barrels equivalents.

According to four sources familiar with the situation, Jefferies has hired investment bankers to manage an auction process on behalf of WildFire. Formal marketing is expected to begin in the next few weeks.

They warned that the volatile markets could mean there is no guarantee of a sale of WildFire and that the valuation of the 'company' may change from the $4 billion expected. These people spoke under condition of anonymity in order to discuss confidential discussions.

WildFire and Jefferies have not responded to requests for comment, while Warburg & Kayne Anderson have declined to comment.

WildFire received its first backing from Warburg and Kayne Anderson in 2019. Since then, the management team has expanded?the company through a variety of acquisitions including production assets from APA Corp. and Chesapeake Energy. Reporting by David French in New York and Shariq KHan; editing by Chizu Nomiayama

(source: Reuters)