Amplify Energy Stock Tumbles After Merger Agreement With Juniper Capital: Retail Sentiment Hits Year-Low Level

Oil and natural gas player Amplify Energy Corp (AMPY) shares declined over 9% on Wednesday after the company announced a merger agreement with Juniper Capital, a Texas-based energy investment firm.

The deal seeks to merge Amplify with certain Juniper portfolio companies that own substantial oil-weighted producing assets and significant leasehold interests in the DJ and Powder River Basins.

Amplify Energy will issue approximately 26.7 million shares of its common stock to Juniper and assume roughly $133 million in net debt.

Amplify shareholders will retain approximately 61% of the firm’s outstanding equity, and approximately 39% will be owned by Juniper.

The company sees significant benefits from the deal. Amplify highlighted that the transaction adds approximately 19 million barrels of oil equivalent (MMBoe) of Proved Developed Reserves and also adds approximately 287,000 net acres in the DJ and Powder River Basins in Wyoming adjacent to some of the largest publicly traded U.S. oil companies.

The assets are also expected to generate strong margins with low operating costs that would improve operating metrics across the combined company. The transaction would be significantly accretive to free cash flow in 2025 and over a five-year period.

Amplify CEO Martyn Willsher said the transaction adds a new oil-rich area with significant current production and substantial upside to the company’s asset base.

“We believe that the Rockies area will experience substantial growth in the coming years, and we look forward to developing this position while becoming more organizationally focused and efficient,” he said.

On Stocktwits, retail sentiment dipped further into the ‘extremely bearish’ territory (4/100), hitting a year-low level. At the same time, retail chatter climbed further into the ‘extremely high’ levels (93/100).

AMPY’s Sentiment Meter and Message Volume as of 11:49 a.m. ET on Jan. 15, 2025 | Source: Stocktwits

One user expressed a short take on the stock.

Meanwhile, Amplify expects the transaction to close in the second quarter of 2025. The stock has gained just over 1% over the past year.

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