The combined company, dubbed New TORC, will be led by TORC's existing management team.
The deal values Vero at about $3 per share, representing a 48 per cent premium to its average trading price over the previous 10 days.
The total transaction price is $177 million, including net debt.
Both companies are focused on Alberta light oil plays such as the Cardium and Alberta Bakken.
Vero shares soared 14 per cent to $2.59 on the Toronto Stock Exchange Thursday. Some 5.4 million shares traded hands, making it one of the most active stocks on the TSX.