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Zacks' 7 Best Strong Buy Stocks (New Research Report)
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Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.
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GeoPark Expands in Colombia With Strategic Repsol Acquisition
GeoPark Limited (GPRK - Free Report) recently announced its accord with Repsol Exploración S.A. and Repsol E&P S.A.R.L to acquire Repsol, S.A.’s (REPYY - Free Report) upstream oil and gas assets in Colombia.
An Insight Into GPRK’s Sale and Purchase Agreement
As a leading energy company in Latin America, GPRK’s prospective accord is to purchase some high-quality assets in one of the most productive oil regions of Colombia called the Llanos Basin. In this region, GPRK has a track record of successfully discovering oil and is also a deep-rooted operator of above- and below-ground operations.
GPRK, carrying a Zacks Rank #4 (Sell) at present,would acquire Repsol Colombia O&G Limited, which holds a 45% working interest in the CPO-9 Block in the Meta Department and would also acquire a 25% working interest of Repsol in SierraCol Energy Arauca LLC. The operator of the CPO-9 Block is Ecopetrol S.A. (EC - Free Report) , which holds the remaining 55% working interest in that block. As of September 2024, these assets produced about 16,000 barrels of oil equivalent per day for Repsol.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
GPRK’s Acquisition to Align With Its “North Star” Strategy
The acquisition aligns firmly with the company’s growth strategy, “North Star,” which targets high-valued and advantaged assets in the Llanos Basin and aims to deliver a highly profitable and sustainable portfolio across Latin America. The new portfolio would boost the company’s production levels, reserves and cash flow while maintaining a low capital investment. The acquisition also complements the company’s recent expansion into Argentina's Vaca Muerta play, enabling its risk diversification strategy.
GPRK’s Financial Structure to Support the Deal
The $530 million deal is planned to be financed through cash and a $345 million non-recourse debt facility arranged by Macquarie Bank Limited. This financing is supported by a strong hedging strategy that ensures price protection and reliable debt servicing.
Since the deal is subject to regulatory approvals and certain conditions, its completion is not assured by the company.