Deal Description: On January 9, 2020, Kimbell Royalty Partners, LP (“Kimbell”), a leading owner of oil and gas mineral and royalty interests across 28 states, announced that it has agreed to acquire the mineral and royalty interests held by Dallas-based Springbok Energy Partners, LLC and Springbok Energy Partners II, LLC (collectively, “Springbok”) in a transaction valued at approximately $175 million, subject to purchase price adjustments. The purchase price for the acquisition is comprised of $95 million in cash and an aggregate of approximately 2.2 million common units of Kimbell and approximately 2.5 million common units of Kimbell Royalty Operating, LLC, together valued at approximately $80 million based on a closing price of $16.94 per common unit for Kimbell’s common units as of January 8, 2020. The transaction is expected to close in the second quarter of 2020, subject to customary closing conditions.
Also on January 9, 2020, Kimbell announced the pricing of its public offering of 5,000,000 common units representing limited partner interests, at a public offering price of $15.50 per common unit. The offering is expected to close on January 14, 2020, subject to customary closing conditions.
Kimbell intends to use the net proceeds from the offering to fund a portion of the cash purchase price for the Springbok acquisition and to pay fees and expenses related to the Springbok acquisition. Pending the closing of the Springbok Acquisition, Kimbell intends to use the net proceeds from the offering for the repayment of outstanding borrowings under its revolving credit facility. Kimbell may use future amounts borrowed under its revolving credit facility for general partnership purposes, including a potential redemption of a portion of its outstanding 7.0% Series A Cumulative Convertible Preferred Units.
Baker Botts L.L.P. represented Kimbell in both the acquisition and the equity offering.
Value: $175 million (acquisition); $77.5 million (equity offering)
Baker Botts Lawyers/Office Involved:
For more information, please see Kimbell’s news release by clicking here.
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