Diversified Energy Fuels Anadarko Expansion with Innovative Carlyle-Backed Securitization
Oil and gas investors are keenly observing a significant strategic maneuver in the North American upstream sector. Diversified Energy Company (NYSE: DEC, LSE: DEC), a prominent player in the acquisition and optimization of producing energy assets, has announced a substantial expansion of its Oklahoma footprint. Partnering with global investment powerhouse Carlyle’s (NASDAQ: CG) Global Credit platform, Diversified will acquire a compelling portfolio of oil and natural gas properties and associated infrastructure located within Oklahoma’s prolific Anadarko Basin from Camino Natural Resources. This acquisition, valued at $1.175 billion before customary purchase price adjustments, not only augments Diversified’s operational scale but also showcases an innovative asset-backed securitization (ABS) financing structure designed to unlock growth without traditional equity issuance.
The transaction represents a strategic complement to Diversified’s existing Oklahoma operations, immediately adjacent to its current assets. Investors should note the acquisition introduces an additional 100 high-quality, undeveloped inventory locations situated within an actively developing area. Post-acquisition, Diversified will command an impressive inventory exceeding 450 future drilling locations across Oklahoma, signaling robust long-term growth potential. Camino Natural Resources will maintain ownership of its Chickasha development area.
Strategic Partnership and Groundbreaking Financing Structure
This deal strengthens the established partnership between Diversified and Carlyle, initially formed in 2025. This collaboration effectively marries Carlyle’s sophisticated asset-backed finance expertise with Diversified’s proven operational capabilities, creating a powerful engine for investing in proved developed producing (PDP) energy assets throughout the United States. The funding mechanism for this acquisition stands out: it will be executed through a bespoke ABS, meticulously structured and arranged by Carlyle.
In practice, a newly formed special purpose vehicle (SPV) will house the acquired producing assets and issue debt collateralized by the underlying cash flows generated from these energy properties. Carlyle will hold a majority ownership interest of approximately 60% in this SPV, which issues the ABS. Diversified, meanwhile, will retain a minority ownership stake of roughly 40% in the SPV, critically assuming the role of asset operator and manager of the ABS. Furthermore, Diversified will exclusively own 100% of the undeveloped assets outside the SPV, providing additional upside exposure to exploration and development opportunities.
Diversified is funding its net portion of the acquisition, approximately $210 million inclusive of customary purchase price adjustments, through its existing senior secured bank facility. This innovative structure offers efficient, long-term financing that aligns precisely with the asset profile, facilitating scaled investments without relying on traditional corporate financing or new equity offerings. The company anticipates closing this transformative acquisition in the third quarter of 2026, pending standard closing conditions.
Compelling Asset Profile and Operational Synergies
The newly acquired Anadarko Basin portfolio delivers significant production and reserve additions, presenting attractive financial metrics for oil and gas investors. The assets currently produce approximately 300 MMcfepd (~51 Mboepd) net, with a balanced production mix of roughly 55% natural gas, 30% natural gas liquids (NGLs), and 15% oil. This diversification helps mitigate commodity price volatility. The acquisition also adds approximately 1,478 Bcfe in total proved reserves. The estimated next twelve months (NTM) EBITDA for these assets stands at a robust ~$397 million, translating to an appealing ~3.0x multiple of NTM EBITDA and a price per flowing Mboe of approximately $23,000.
Beyond current production, the portfolio encompasses approximately 101,000 acres of commercially attractive leasehold within the highly prospective SCOOP/STACK/MERGE plays. Critically, over 100 identified, drill-ready inventory locations are included, boasting a high average working interest of around 80%. When combined with existing undeveloped locations from Diversified’s recent Oklahoma acquisitions, the company now commands an estimated 450+ highly economic development locations. This substantial inventory represents approximately 30 years of drilling potential at a steady one-rig pace (11-14 wells per year), offering considerable longevity and value creation prospects for shareholders.
The contiguous nature of these assets with Diversified’s existing Oklahoma operations creates immediate and tangible opportunities for operational efficiencies and General & Administrative (G&A) cost savings. Diversified’s “Smarter Asset Management” approach will be applied to these new assets, aiming to improve production, enhance margins, and significantly grow free cash flow. Furthermore, the extensive inventory of drill-ready locations is expected to drive incremental cash flow through Diversified’s Portfolio Optimization Programs, adding considerable net asset value (NAV) and future optionality.
Executive Perspectives and Future Outlook
Rusty Hutson, Jr., CEO of Diversified Energy Company, emphasized the strategic alignment and financial innovation of the deal. He remarked on the “perfect fit” with existing Oklahoma operations and the substantial opportunities for synergy realization. Mr. Hutson underscored the company’s commitment to its strategy of acquiring high-quality, producing assets at attractive valuations, confidently stating that the assets would benefit from their proven Smarter Asset Management approach. He also highlighted the potential for increased production or enhanced free cash flow from the significant drill-ready inventory, reinforcing Diversified’s track record of shareholder value delivery.
Akhil Bansal, Carlyle’s Head of Asset-Backed Finance, echoed the sentiment of a successful partnership. He commended the synergy between Carlyle’s structuring expertise and long-term capital with Diversified’s operational excellence. Mr. Bansal views this financing solution as a purpose-built model for asset-backed investing, signaling Carlyle’s continued commitment to innovative capital solutions in the energy sector. Carlyle’s Asset-Backed Finance team, part of its Global Credit platform, has deployed approximately $11 billion since 2021 and manages over $10 billion in assets as of December 31, 2025, demonstrating its significant capabilities in this specialized area.
For investors, this acquisition represents a compelling expansion of Diversified’s core strategy, offering growth, operational synergies, and a de-risked financing model. The off-balance sheet treatment of the ABS SPV debt will provide balance sheet flexibility, while Diversified stands to benefit from enhanced economic returns through its promoted interest and management fee structure. The company also retains a preferential asset buyback option, providing a future opportunity to acquire de-levered assets. This approach provides a competitive advantage, securing pre-acquisition financing certainty and enabling larger-scale transactions without direct reliance on corporate equity markets. The transaction was advised by Kirkland & Ellis LLP, Citi, and Truist Securities for Diversified; Latham & Watkins and Paul Hastings for Carlyle; and Jefferies LLC, RBC Richardson Barr, and Vinson and Elkins for Camino, reflecting a robust advisory framework.
