(Reuters) - Oil and gas company Diamondback Energy ( FANG ) said on Tuesday it would buy certain units of Texas-based energy producer Double Eagle in a cash-and-stock deal for about $4.08 billion.

Diamondback added that it would sell at least $1.5 billion of non-core assets to reduce pro-forma debt. The shale producer expects to reduce net debt to $10 billion and, long term, maintain leverage of $6 billion to $8 billion.

Last year, Reuters had reported that Double Eagle was exploring a sale of its Permian Basin-based producer in a deal that could be worth more than $6.5 billion, including debt.

Fort Worth-based Double Eagle owns over 95,000 net acres in the Midland Basin and represents one of the last large assets in the Permian Basin, the most extensive oil field in the United States.