(P&GJ) — Crescent Energy has agreed to acquire Vital Energy in an all-stock deal valued at about $3.1 billion, including debt, the companies announced on Aug. 25.

Under the terms, Vital shareholders will receive 1.9062 shares of Crescent Class A common stock for each Vital share. That represents a 5% premium to the 30-day volume weighted average price and a 15% premium to Vital’s 30-day average as of Aug. 22.

The merger will create a top-10 independent oil and gas producer with assets across the Eagle Ford, Permian and Uinta basins. The combined company will have more than a decade of development inventory and plans to pursue $90 million to $100 million in annual cost synergies.

“This transaction is transformative for Crescent and consistent with our strategy,” said John Goff, Crescent’s chairman. “Crescent’s impressive trajectory of returns-driven growth through M&A has cemented the company as a top ten independent, with line of sight to an investment grade credit rating.”

Crescent CEO David Rockecharlie said the deal will strengthen cash flow and shareholder returns. “With this acquisition and our $1 billion non-core divestiture pipeline, we are better positioned than ever before. Crescent will have more focus, more scale and more potential to deliver long-term value to shareholders.”

Vital CEO Jason Pigott said the merger “will create a premier, scaled, mid-cap operator with significant efficiencies across a larger asset base.”

Crescent shareholders will own about 77% of the combined company and Vital shareholders around 23%. The boards of both companies unanimously approved the merger, which is expected to close by the end of 2025, subject to regulatory and shareholder approvals.

The company will remain headquartered in Houston, with John Goff as non-executive chairman and David Rockecharlie continuing as CEO.