Fitch puts Diamondback on positive watch

Fitch Ratings said it placed the BBB long-term issuer default ratings and all issue-level ratings of Diamondback Energy, Inc., Diamondback O&G LLC and Energen Corp. (collectively Diamondback) on ratings watch positive.

The RWP follows Diamondback announcing it agreed to buy Endeavor Energy Resources LP in a deal valued at $26 billion.

“The transaction significantly enhances Diamondback's footprint by adding high-quality acreage in the core of the Midland Basin, low cost, oil-weighted production and nearly doubles the company's sub-$40/barrel WTI breakeven inventory. Fitch believes Diamondback's pro forma operating and financial metrics will be in line with Fitch's BBB+ rating category thresholds and consistent with rated BBB+ E&P peers,” the agency said in a press release.

Fitch said it aims to resolve the positive watch upon closing of the deal, which is expected in the fourth quarter of 2024 subject to customary closing conditions. The closing and resolution of the RWP could take longer than six months.

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