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Energy XXI chairman and CEO John Schiller

Energy XXI  said Wednesday it reached a deal to buy EPL Oil & Gas for $1.53 billion.

The combined company will be the biggest publicly traded oil-and-gas producer focused on the Gulf of Mexico.

The new company will have production of about 65,000 barrels of oil equivalent per day.

EPL stockholders will receive $39 a share in cash, 1.669 common shares of Energy XXI, or a combination of $25.35 in cash and 0.584 Energy XXI shares.

John Schiller, Energy XXI chairman and CEO, will stay in his current role to lead the combined company.

 

Energy XXI said it expects to pay about $1 billion in cash and 23.4 million of its shares.

After the closing, which is still subject to shareholder approvals, current Energy XXI investors will hold a 77% stake in the new company, and EPL shareholders will own 23%.