Birmingham-based Diversified Energy is making the largest acquisition in its 25-year history, agreeing to purchase Permian Basin oil and gas producer Birch Permian Holdings in a $1.8 billion deal.
The acquisition would substantially expand Diversified’s footprint in one of the country’s most important energy-producing regions, increasing the company’s production by approximately 35% and adjusted EBITDA by roughly 55%.
Diversified expects the transaction to close during the fourth quarter of 2026, subject to customary closing conditions.
“This $1.8 billion acquisition is our largest in the company’s 25-year history,” Diversified founder, chairman and CEO Rusty Hutson Jr. said in announcing the agreement.
Hutson said the deal will establish Diversified as a “scaled operator” in the Permian Basin while providing a platform for additional acquisitions in the region.
Birch’s assets include approximately 46,000 net mineral acres and roughly 500 operated wells, with current net production of about 68,000 barrels of oil equivalent per day. The acquisition also includes gathering, processing and water infrastructure serving the company’s Permian operations.
The Birmingham-headquartered company has grown rapidly from its beginnings in 2001, when Hutson purchased a group of West Virginia natural gas wells while still working in the financial sector in Birmingham.
Diversified has since expanded across major U.S. oil and gas regions through a strategy focused largely on acquiring and operating existing producing assets.
The Birch deal follows Diversified’s 2025 acquisition of Maverick Natural Resources, which significantly expanded the company’s operations in Texas and surrounding energy markets.
Diversified is also expanding its partnership with global investment firm Carlyle as part of the latest transaction. The companies previously established a framework of up to $2 billion for oil and natural gas investments.
That partnership has now been broadened to allow the companies to pursue as much as $10 billion in potential future acquisition opportunities.
With Birch, Diversified is positioning itself for another major stage of growth after spending the past 25 years expanding from a small portfolio of Appalachian gas wells into a publicly traded energy company operating across several of the nation’s largest producing regions.
The company remains headquartered in Birmingham as it builds an increasingly large footprint in the U.S. oil and natural gas industry.
Sawyer Knowles is a state and political reporter for Yellowhammer News. You may contact him at [email protected].
