Latest news with #Sitio
Yahoo
36 minutes ago
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Viper Energy to Buy Sitio Royalties Corp in $4.1B Deal
This article was first published on Rigzone here Viper Energy Inc and Sitio Royalties Corp announced in a joint statement that they have entered into a definitive agreement under which Viper will acquire Sitio in an all-equity transaction valued at approximately $4.1 billion, including Sitio's net debt of approximately $1.1 billion as of March 31, 2025. 'The consideration will consist of 0.4855 shares of Class A common stock of a new holding company for each share of Sitio Class A common stock, and 0.4855 units of Viper's operating subsidiary, Viper Energy Partners LLC, for each unit of Sitio's operating subsidiary (along with a corresponding amount of Class B common stock of pro forma Viper for each share of Sitio Class C common stock), representing an implied value to each Sitio stockholder of $19.41 per share based on the closing price of Viper common stock on June 2, 2025,' the joint statement noted. The statement highlighted that the deal was unanimously approved by the board of directors of each company and pointed out that it has been approved by the written consent of Diamondback as Viper's majority stockholder. Stockholders holding an aggregate of approximately 48 percent of Sitio's outstanding voting power, including Kimmeridge, its largest stockholder, have agreed to vote in favor of the transaction, the statement noted. The transaction is subject to customary regulatory approvals and is expected to close in the third quarter of 2025, the statement said. In a section highlighting the 'strategic rationale' for the deal, the joint statement outlined that it 'adds substantial scale and inventory depth that will support pro forma Viper's durable production profile and free cash flow growth over the next decade'. The statement also outlined that it offers 'meaningful financial accretion and higher cash returns', 'significant synergies', and 'lowers pro forma Viper's base dividend breakeven by approximately $2 per barrel'. Kaes Van't Hof, Chief Executive Officer of Viper, said in the joint statement, 'the combination of Viper and Sitio signifies an important moment for mineral and royalty interests'. 'This combination creates a leader in size, scale, float, liquidity and access to investment grade capital in the highly fragmented minerals industry. Pro forma Viper is now clearly a must-own public mineral and royalty company in North America, with attractive size and scale in the Permian Basin,' Van't Hof added. 'This transaction positions Viper to compete for capital with mid and large cap North American E&Ps except with higher margins, minimal operating costs, and the lowest dividend breakeven in the space,' Van't Hof continued. 'While this transaction will reduce Diamondback's ownership in pro forma Viper to 41 percent, it does not reduce the significance of the relationship between Diamondback and Viper,' Van't Hof said in the statement. 'The Diamondback drillbit remains Viper's biggest competitive advantage and the most visible source of long-term production growth at Viper. Mineral interests offer the highest form of security and upside in the oil field, and any and all benefits an operator manages to unlock accrues directly to the mineral holder without any capital risk, forever,' Van't Hof went on to note. Sitio CEO Chris Conoscenti said in the statement, 'we are excited to announce the combination of two leading minerals companies with a shared strategic vision of integrating the highest quality assets to create a truly differentiated investment opportunity for shareholders'. 'This transaction provides Sitio's shareholders with exposure to an entity with significantly greater size, future development visibility, and all of the benefits of the economies of scale unique to the minerals business - higher margins, lower cost of capital, strong positioning for future M&A opportunities, and the ability to return more capital to shareholders,' he added. 'I want to thank all of the Sitio team members, whose innovation and relentless pursuit of continuous improvement made building Sitio such an amazing and rewarding experience,' he continued. Noam Lockshin, Chairman of the Sitio Board of Directors, said in the statement, 'this transaction is the next logical step in Sitio's evolution'. Take control of your THOUSANDS of Oil & Gas jobs on Search Now >> 'By adding Sitio's coverage of the Delaware Basin to Viper's position in the Midland Basin, the combined company will be well positioned in the Permian for years to come,' Lockshin added. Analyst Take While corporate mergers are a staple of oil and gas operators, they have been rare in the more sedate minerals space, Andrew Dittmar, principal analyst at Enverus Intelligence Research (EIR), said in a statement sent to Rigzone commenting on the Viper-Sitio deal. 'Now, for just the second time Enverus has tracked, two publicly traded minerals companies are combing with Viper Energy Partners buying Sitio Royalties for $4.1 billion inclusive of net debt,' Dittmar highlighted in the statement. 'The only other significant mineral public company merger tracked by Enverus also involved Sitio when it acquired Brigham Minerals for $1.9 billion in 2022. Deal activity, while active in the space, is usually confined to smaller bolt-on transactions and consolidation of individual interests,' he added. 'Viper, which is affiliated with upstream operator Diamondback Energy, has turned to an unusually active spree of deals to create a public mineral company with differentiated scale compared to peers,' he continued. 'Inclusive of the Sitio merger and a major dropdown from Diamondback, Viper has now spent over $8 billion on acquisitions in 2025 or more than the cumulative value of all disclosed mineral M&A in 2023 and 2024,' Dittmar noted. 'Since the start of 2023, Viper has accounted for 70 percent of publicly disclosed mineral M&A, taking on the job of consolidating and bringing to public markets at an investible scale the fragmented space,' he went on to state. Despite the attractive yields and low capital requirement of the mineral space, the small size and market capitalization of these somewhat niche companies likely limited their appeal to the broader investment community, Dittmar said in the statement. 'Viper already had a leading scale among pure mineral companies with a market capitalization over $12 billion, but adding Sitio still helps boost the company's public float given the substantial ownership by Diamondback, sitting at 41 percent pro forma for the Sitio acquisition,' he added. 'Viper will have a pro-forma market capitalization of around $15 billion, trailing just Texas Pacific Land, which has a mixed royalty and surface ownership business, and about five times the scale of the next largest company, Blackstone Minerals. Its market capitalization will sit between operators Coterra and Permian Resources,' Dittmar noted. Besides its scale, Viper is differentiated by the quality of its asset base with a concentration in the Permian Basin, Dittmar said in the statement, describing the Permian as 'by a significant margin the largest and most economic U.S. shale play'. 'The company was previously focused on the Midland Basin and particularly on interests operated by Diamondback,' Dittmar highlighted in the statement. 'This deal materially increases its exposure to the Delaware Basin. That does drop Viper's weighting towards Diamondback and the unique insight into development plans that offers but given the quality of Delaware inventory investors are likely to take that in stride,' he added. 'Furthermore, ExxonMobil accounts for almost half of third-party operated production including third-party Midland volumes, per Viper, giving investors further confidence in these assets,' he continued. Besides the increased Permian exposure, Sitio brings to the table royalty interests in the DJ, Eagle Ford, and Williston Basin, Dittmar noted. 'That is something Viper could look to sell once the deal closes to return to its status as a Permian pure play,' Dittmar highlighted in the statement. 'That should be straight forward to accomplish as there is a ready and active market for minerals including significant interest from private capital,' he added. To contact the author, email More From The Leading Energy Platform: USA Crude Oil Inventories Drop 4.3 Million Barrels Week on Week Bilfinger Picked by Cadent to Upgrade UK Gas Distribution Network BP Enters Into Series of Azerbaijan Deals Equinor, Centrica Sign $27 Billion Gas Sales Deal >> Find the latest oil and gas jobs on << Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Wire
16 hours ago
- Business
- Business Wire
SITIO ROYALTIES INVESTOR ALERT by the Former Attorney General of Louisiana: Kahn Swick & Foti, LLC Investigates Adequacy of Price and Process in Proposed Sale of Sitio Royalties Corp.
NEW YORK CITY & NEW ORLEANS--(BUSINESS WIRE)--Former Attorney General of Louisiana Charles C. Foti, Jr., Esq. and the law firm of Kahn Swick & Foti, LLC ('KSF') are investigating the proposed sale of Sitio Royalties Corp. (NYSE: STR) to Viper Energy, Inc. (NasdaqGS: VNOM). Under the terms of the proposed transaction, the consideration will consist of 0.4855 shares of Class A common stock of a new holding company ('pro forma Viper') for each share of Sitio Class A common stock, 0.4855 units of Viper's operating subsidiary, Viper Energy Partners LLC, for each unit of Sitio's operating subsidiary, and 0.4855 units of Class B common stock of pro forma Viper for each share of Sitio Class C common stock. KSF is seeking to determine whether this consideration and the process that led to it are adequate, or whether the consideration undervalues the Company. If you believe that this transaction undervalues the Company and/or if you would like to discuss your legal rights regarding the proposed sale, you may, without obligation or cost to you, e-mail or call KSF Managing Partner Lewis S. Kahn ( toll free at any time at 855-768-1857, or visit to learn more. To learn more about KSF, whose partners include the Former Louisiana Attorney General, visit
Yahoo
16 hours ago
- Business
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Vinson & Elkins Advises Sitio Royalties in $4.1B Transaction with Viper Energy
By Karen Roman Vinson & Elkins said it advised Sitio Royalties Corp.'s (NYSE: STR) entry into a definitive agreement with Viper Energy, Inc. (Nasdaq: VNOM), under which a subsidiary of Viper will buy Sitio in an all-equity transaction valued at approximately $4.1 billion. The transaction includes Sitio's net debt of approximately $1.1 billion as of March 31, the law firm wrote int a statement. The deal is scheduled to close by the third quarter of 2025, it said. The Vinson & Elkins team was led by partners Doug McWilliams (Houston), Benji Barron (Houston), Scott Rubinsky (Houston) and associate Chase Browndorf (Houston), among others. 'The combination of Viper and Sitio signifies an important moment for mineral and royalty interests,' said Kaes Van't Hof, Viper's CEO. 'This combination creates a leader in size, scale, float, liquidity and access to investment grade capital in the highly fragmented minerals industry.' Contact: CorpGov Editor@ The post Vinson & Elkins Advises Sitio Royalties in $4.1B Transaction with Viper Energy appeared first on CorpGov. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
19 hours ago
- Business
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Viper Energy to Acquire Sitio Royalties in $4.1B All-Stock Deal
Viper Energy, Inc. VNOM, a subsidiary of the independent oil and gas exploration firm Diamondback Energy, announced that it has entered into an agreement to acquire Sitio Royalties STR in an all-stock transaction totaling $4.1 billion. The total valuation includes Sitio's net debt of $1.1 billion at the end of the first quarter of 2025. In addition to the acquisition of Sitio Royalties in the Permian Basin, the company has also announced a 10% increase in its base dividend to $1.32 per share annually, or 33 cents quarterly. For each share of Sitio Class A common stock, the shareholders will receive 0.4855 shares of Class A common stock of Viper, and against each unit of Sitio's operating subsidiary, unitholders are expected to get 0.4855 units of Viper Energy Partners LLC, Viper's operating subsidiary. This transaction has resulted in an implied share price of $19.41 per share for Sitio's stockholders, based on Viper's share price as of June 2, 2025. Following the announcement, shares of Viper Energy have risen almost 1% while those of Sitio Royalties have gained approximately 12%. The deal is anticipated to be closed in the third quarter of 2025. The transaction is deemed to be a strategic fit for Viper Energy that should enhance its scale and inventory to support sustainable production growth for the next 10 years. Further, this should enable VNOM to strengthen free cash flow generation over the next decade. The companies also expect the acquisition to be immediately accretive to cash available for distribution per Class A share by nearly 8-10%. Additionally, the deal is expected to generate more than $50 million in annual synergies, primarily due to a reduction in general and administrative costs and cost of capital savings. Post closing of the transaction, Viper Energy intends to uphold its Investment Grade rating, keeping its net debt target at $1.5 billion in the near term. The acquisition will also improve Viper Energy's financials by reducing its pro forma base dividend breakeven to below $20 WTI, roughly $2 per barrel lower than prior estimates. Sitio Royalties' total acreage dropped to approximately 34,300 net royalty acres, of which nearly 25,300 net royalty acres lie within the prolific Permian basin and approximately 9,000 net royalty acres are concentrated in other major basins in the United States, such as the Eagle Ford Basin and Williston Basin. The deal will increase Viper's Permian Basin footprint by 42%. The combined entity will own approximately 85,700 net royalty acres in the Permian Basin, of which 43% shall be operated by Diamondback. Following the closure of the deal, Viper Energy's pro forma average production in the fourth quarter is expected to be in the range of 122-130 thousand barrels of oil equivalent per day (mboe/d). After the Sitio acquisition, Diamondback Energy will own approximately 41% of pro forma Viper's outstanding common stock. Both VNOM and STR currently carry a Zacks Rank #3 (Hold). Some better-ranked stocks from the energy sector are Flotek Industries Inc. FTK and Energy Transfer ET. While Flotek Industries sports a Zacks Rank #1 (Strong Buy) at present, Energy Transfer carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here. Flotek Industries specializes in green chemistry, which provides innovative solutions aimed at reducing the environmental impact of the energy industry. Flotek develops specialty chemicals tailored for both domestic and international energy producers, as well as oilfield service companies. These chemicals not only help reduce the environmental impact of hydrocarbon production but also lower operational costs. Energy Transfer is a midstream player that owns and operates one of the most diversified portfolios of energy assets in the United States. Boasting a pipeline network extending more than 130,000 miles, its network spans over 44 states. With a presence in all the major U.S. production basins, ET's outlook seems positive. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Sitio Royalties Corp. (STR) : Free Stock Analysis Report Energy Transfer LP (ET) : Free Stock Analysis Report Flotek Industries, Inc. (FTK) : Free Stock Analysis Report Viper Energy Inc. (VNOM) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
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Viper Energy to acquire Sitio Royalties for $4.1bn
Diamondback Energy's subsidiary Viper Energy has agreed to acquire Sitio Royalties in an all-equity transaction valued at around $4.1bn. The deal includes Sitio's net debt of approximately $1.1bn as of 31 March 2025. Sitio is a pure-play mineral and royalty company engaged in the acquisition of high quality oil and gas mineral and royalty interests in productive US basins. As of 31 March 2025, Sitio has accumulated around 34,300 net royalty acres via the consummation of more than 200 acquisitions. Viper owns, acquires and exploits oil and natural gas properties in North America, with a focus on owning and acquiring mineral and royalty interests in oil-weighted basins, primarily the Permian Basin. The boards of both companies have unanimously approved the transaction, and Diamondback, as Viper's majority stockholder, has also given written consent. Post-acquisition, Diamondback is expected to own around 41% of pro forma Viper's outstanding common stock and will continue to drive meaningful long-term oil production growth from the company's acreage. The transaction is anticipated to close in the third quarter of 2025 (Q3 2025), subject to customary regulatory approvals. Viper chief executive officer Kaes Van't Hof said: 'The combination of Viper and Sitio signifies an important moment for mineral and royalty interests. This combination creates a leader in size, scale, float, liquidity and access to investment grade capital in the highly fragmented minerals industry. Pro forma Viper is now clearly a must-own public mineral and royalty company in North America, with attractive size and scale in the Permian Basin. 'This transaction positions Viper to compete for capital with mid and large cap North American E&Ps [exploration and production companies]; except with higher margins, minimal operating costs and the lowest dividend breakeven in the space.' In conjunction with the acquisition news, Viper announced a 10% increase to its base dividend, which now stands at $1.32 per share annually, or $0.33 per share quarterly. "Viper Energy to acquire Sitio Royalties for $4.1bn" was originally created and published by Offshore Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
