Frontera to sell Colombian operations to Parex in $750m deal

Group 1 - Frontera Energy has signed a definitive agreement with Parex Resources for the sale of its Colombian exploration and production assets, valued at $750 million, including debt [1][2] - Parex will acquire these assets for an equity consideration of up to $525 million, with $500 million due at closing and an additional $25 million contingent upon an extension of the Quifa association contract within 12 months [1][2] - The total transaction value includes Frontera's $310 million in 2028 senior unsecured notes and an $80 million Chevron prepayment facility [2] Group 2 - Frontera Energy's CEO stated that Parex, as the largest independent operator in Colombia, brings strong operational and financial capabilities, ensuring continuity for employees, partners, and communities [2] - Following the agreement, Frontera will transition to a pure-play infrastructure company with approximately $77 million in distributable cash flows and several growth catalysts at Puerto Bahia [3] - The agreement with Parex follows a revised proposal that offered an additional $125 million in equity consideration compared to a previous arrangement with GeoPark [3][4] Group 3 - Frontera intends to distribute approximately $470 million to shareholders after closing, subject to shareholder approval, which is expected to be around C$9.18 per share [4] - The remaining business will focus on infrastructure assets, including a 35% stake in the Oleoducto de los Llanos Orientales pipeline and a 99.97% interest in Sociedad Portuaria Puerto Bahia [5] - Upon completion of the transaction, Frontera estimates it will retain around $50 million in cash and equivalents to support strategic initiatives within its infrastructure business [6]