Private-equity firm Riverstone Holdings LLC will become a majority shareholder in Silver Run Acquisition Corp. after Riverstone exchanged an interest in an oil-and-gas developer and cash for Silver Run shares.

Two weeks ago, Riverstone said it had agreed to buy an 89% stake in Texas oil-and-gas developer Centennial Resources.

Friday, Riverstone said it has agreed to turn over that right to Silver Run and will buy 81 million shares of Silver Run for $10 a share, leaving Riverstone with a 51% stake in Silver Run.

Silver Run will buy Centennial for an enterprise value of about $1.74 billion.

Silver Run Acquisition Corp. raised $500 million in February to fund its ability to buy up oil-and-gas assets that have been devalued recently because of cheap energy prices. Shares at Silver Run closed Thursday at $10.20, up 3.3% over the past three months.

Other investors will buy another $200 million of new equity in Silver Run, with the fresh investment going toward funding "a portion of the cash" needed to fund the Centennial purchase.

If the deal closes, which depends on a shareholder vote, Silver Run expects to be renamed Centennial Resource Development Corp. and trade on the Nasdaq Stock Market under the ticker symbol "CDEV."

Write to Austen Hufford at austen.hufford@wsj.com

(END) Dow Jones Newswires

July 22, 2016 09:45 ET (13:45 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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