Feb 18 (Reuters) - Oil and gas company Diamondback

Energy ( FANG ) said on Tuesday it would buy certain units of

EnCap-backed energy producer Double Eagle in a cash-and-stock

deal for about $4.08 billion.

The deal would give Diamondback access to about 40,000

net acres in the core of Midland Basin, one of the last large

assets in the Permian Basin - the most extensive oil field in

the United States.

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 lower net debt to $10 billion and, long term,

maintain leverage of $6 billion to $8 billion.

Last year, Reuters had reported that Texas-based 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.

"Double Eagle is the most attractive asset remaining in the

Midland Basin. With 407 locations adjacent to our core position,

this largely undeveloped asset adds high-quality inventory,"

Diamondback CEO Travis Stice said in a statement.

Diamondback said it would pay roughly 6.9 million shares

and $3 billion in cash, which it expects to fund through a

combination of cash on hand and borrowings.

The transaction is expected to close on April 1.