Summary
Diamondback Energy, Inc. (FANG) has filed an 8-K report detailing two significant financing activities that are directly tied to its previously announced acquisition of assets from Brigham Resources. The company announced the pricing of an underwritten public offering of 10.5 million shares of common stock and an upsized $500 million offering of 5.375% Senior Notes due 2025. These offerings are intended to fund the cash consideration required for the Brigham Resources acquisition. The equity offering aims to raise capital through the sale of stock, while the notes offering, priced slightly below par at 99.168% of par, will add debt to the company's capital structure. The combined proceeds, along with existing cash, will facilitate the acquisition, suggesting a strategic move to expand Diamondback's asset base. Investors should note that the notes are offered privately to qualified institutional buyers and certain non-U.S. persons, and are not registered under the Securities Act.
Key Highlights
- 1Diamondback Energy priced a public offering of 10,500,000 shares of common stock.
- 2The company also priced an upsized offering of $500 million aggregate principal amount of 5.375% Senior Notes due 2025.
- 3The proceeds from both the equity and debt offerings are intended to fund the cash consideration for the pending acquisition of certain oil and gas assets from Brigham Resources.
- 4The Senior Notes offering is expected to close on December 20, 2016, subject to customary closing conditions.
- 5The Senior Notes were offered to qualified institutional buyers and certain non-U.S. persons, not registered under the Securities Act.
- 6The Senior Notes were priced at 99.168% of par.