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U.S. shale producer %CrescentEnergy (NYSE: $CRGY ) is buying smaller rival %VitalEnergy (NYSE: $VTLE ) in an all-stock deal worth $3.1 billion U.S., including existing debt.

Vital shareholders will receive 1.9062 shares of Crescent common stock for each share held, representing a value of $18.95 U.S. per share and a premium of 20% over the stocks' last closing price.

%Shale refers to oil that's extracted from sedimentary rock using a hydraulic fracturing process.

Shares of Vital Energy climbed 7% higher on news of the acquisition, while the stock of Crescent Energy declined 8% in premarket trading on Aug. 25.

It had been previously reported that Crescent Energy was in advanced talks to acquire Vital Energy amid a growing wave of consolidation in the sector.

In the past week, %CenovusEnergy (NYSE: $CVE ) announced that it is buying rival %MEGEnergy (TSX: $MEG ) in a $7.9 billion U.S. cash-and-stock deal.

Once the deal is finalized, Crescent Energy shareholders will own 77% of the combined company while Vital shareholders will own the remaining 23%.

The deal is expected to close by the end of this year, subject to regulatory approval.

Prior to today (Aug. 25), CRGY stock had declined 33% this year to trade at $9.94 U.S. per share.

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