As part of the deal, Crescent will issues $100 million of equity to Carnelian Energy Capital Management-backed Ridgemar and pay the remainder in cash. (Source: Shutterstock/ Crescent Energy)
Crescent Energy has upsized its offering of common stock to 21.5 million Class A shares and, on Dec. 4, announced a private placement of $300 million in senior notes as it raises cash for its acquisition of Eagle Ford E&P Ridgemar Energy.
On Dec. 3, Crescent said it signed a definitive agreement to acquire Ridgemar for a base price of $905 million plus an additional $170 million in contingency payments that are based on future WTI prices.
As part of the deal, Crescent will issues $100 million of equity to Carnelian Energy Capital Management-backed Ridgemar and pay the remainder in cash.
Crescent initially said it would offer 18.5 million shares of its stock before adding another 3.5 million to its original offering. The shares have not yet been priced. Proceeds will be used to fund the cash consideration of the Ridgemar deal, which is expected to closed in first-quarter 2025.
If the Ridgemar acquisition is not completed, proceeds will be used to reduce the company’s outstanding borrowings from its revolving credit facility or for general corporate purposes. The underwriters of the offering have an option to purchase an additional 3.225 million shares.
Wells Fargo Securities LLC, KKR Capital Markets LLC, Raymond James & Associates Inc. and Evercore Group LLC are serving as joint book-running managers for the offering. Mizuho Securities USA LLC and Truist Securities Inc., are also serving as joint book-running managers. KeyBanc Capital Markets, PEP Advisory LLC, Stephens Inc. and TPH&CO., the energy business of Perella Weinberg Partners are serving as co-managers for the offering. The offering is expected to close on Dec. 5, subject to customary closing conditions.
Crescent has said it will also offer $300 million of 7.625% Senior Notes due in 2032. Similar to its public stock offering, Crescent will use the net proceeds to fund the Ridgemar acquisition. Likewise, if the deal fails to close, proceeds will be used to reduce borrowings or for general corporate purposes.
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