Newly formed energy SPAC, Black Mountain Acquisition Corp., recently closed an upsized IPO with proceeds of $244 million earmarked to capitalize on the success of its founder and entrepreneur, Rhett Bennett.

Since 2007, Bennett has led the growth of the Black Mountain entities, many of which he continues to lead as CEO, across several business units, including E&P operations, commercial saltwater disposal, midstream and in-basin frac sand mining. 

“We believe that the experience, capabilities and strong reputation of Rhett Bennett and the other members of our management team will make us an attractive partner to potential target businesses, enhance our ability to complete a successful business combination and bring value to the business following such combination,” the company said in its S-1 filing with the U.S. Securities and Exchange commission (SEC).

As the founder and CEO of Black Mountain Sand, Bennett led the creation and growth of the largest in-basin frac sand provider in the U.S.

Prior to founding Black Mountain Sand, he served as founder and CEO of Black Mountain Oil & Gas, where he built a formidable position in the northern Delaware Basin of the Permian before selling the company to Marathon Oil Corp. for $700 million in 2017. The sale of Black Mountain Oil & Gas resulted in a gross return of 5.5 times return on investment and a 298% IRR, according to the SEC filing.

Other Black Mountain entities founded by Bennett include lack Mountain Oil & Gas II LLC, Black Mountain Metals LLC, Black Mountain Minerals LLC, Wing Resources LLC and Black Mountain Midstream LLC.

“We intend to identify and acquire a business that could benefit from a hands-on owner with extensive transactional, financial, managerial and investment experience in the energy value chain that presents potential for an attractive risk-adjusted return profile under our stewardship,” the company continued in its filing.

In the filing, the company noted many attractive investment opportunities in the energy sector with “tremendous growth potential” by concentrating its investment on the E&P segment where certain valuations have reached historic lows as result of current market conditions.

“Even fundamentally sound companies can often underperform their potential due to underinvestment, a temporary period of dislocation in the markets in which they operate, over-levered capital structures, excessive cost structures, incomplete management teams and/or inappropriate business strategies,” the company said. “We believe that our management team has a unique and differentiated perspective based upon our broad, 24-year heritage investing across global energy markets.”

In addition to Bennett, Jacob Smith serves as CFO, chief accounting officer, secretary and director of Black Mountain Acquisition Corp. Smith has been involved with certain Black Mountain entities as CFO or chief accounting officer since 2014. He previously worked in accounting at TPG Capital LP.

Additionally, industry veterans Mel G. Riggs, Stephen Straty and Chuck Yates were appointed as members of the Black Mountain Acquisition Corp. board on Oct. 13 to serve as independent directors.

Black Mountain Acquisition Corp. priced its upsized IPO of 24 million unit at a price of $10 per unit. Each unit consists of one share of the company’s Class A common stock and three quarters of one redeemable warrant, with each whole warrant entitling the holder thereof to purchase one share of the company’s Class A common stock at an exercise price of $11.50 per share. 

The Black Mountain Acquisition Corp. stock is listed on the New York Stock Exchange and trades under the ticker symbol “BMAC”.

EarlyBirdCapital Inc. and Stephens Inc. are book-running managers and representatives of the underwriters, which were granted the underwriters a 45-day option to purchase up to an additional 3.6 million units at the IPO price.

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