Centennial Resource Development, Inc. together with its affiliates (“CDEV”, “Centennial” or the “Company”) (NASDAQ:CDEV) (NASDAQ:CDEVW), announced today that it has closed the previously announced acquisition of leasehold interests and related upstream assets in Reeves County from Silverback Exploration, LLC (“Silverback”) for a purchase price of approximately $855 million, subject to customary post-closing adjustments.
Centennial also announced today that it has closed the previously announced private placement of equity securities with certain accredited investors, including Riverstone Holdings LLC and affiliated funds (collectively, “Riverstone”), for total gross proceeds of $910 million. Third-party investors other than Riverstone purchased $480 million of CDEV Class A common stock at $14.54 per share. Riverstone purchased $430 million of equity securities in a combination of CDEV Class A common stock at $14.54 per share and preferred shares at the common equivalent of $14.54 per share. The preferred shares will be convertible into shares of CDEV Class A common stock upon the approval of the Company’s stockholders of such conversion at a special meeting. Holders of the preferred shares will not be entitled to a preferred dividend, but will be entitled to participate in dividends payable on the CDEV Class A common stock. The preferred shares will also have a liquidation preference of $0.0001 per share and holders will be entitled to participate with common stockholders in distributions upon liquidation. Net proceeds from the offering were used to fully fund the Company’s acquisition of the upstream assets of Silverback, with the remaining portion of the net proceeds to be used for general corporate purposes.
In conjunction with the closing of the acquisition, Centennial closed an amendment with the lenders under its revolving credit facility that, among other things, increases the borrowing base to $250 million from $200 million. The Company currently has no amounts drawn under its revolving credit facility, and the next scheduled borrowing base redetermination will be held in the spring of 2017.
About Centennial Resource Development, Inc.
Centennial Resource Development, Inc., is an independent oil and natural gas company focused on the development and acquisition of unconventional oil and associated liquids-rich natural gas reserves in the Permian Basin. The Company’s assets and operations, which are held and conducted through Centennial Resource Production, LLC, are concentrated in the Delaware Basin, a sub-basin of the Permian Basin. For additional information about the Company, please visit www.cdevinc.com.
About Silverback Exploration, LLC
Silverback Exploration, LLC is a San Antonio-based, independent oil and gas company focused on the pursuit of leasing and drilling opportunities in domestic resource plays, both conventional and unconventional. Silverback was formed in November 2013 with an equity commitment from EnCap Investments, L.P.
About Riverstone Holdings LLC
Riverstone Holdings LLC is an energy and power-focused private investment firm founded in 2000 by David M. Leuschen and Pierre F. Lapeyre, Jr. with over $34 billion of capital raised. Riverstone conducts buyout and growth capital investments in the exploration & production, midstream, oilfield services, power, and renewable sectors of the energy industry. With offices in New York, London, Houston, and Mexico City, Riverstone has committed over $33 billion to more than 120 investments in North America, Latin America, Europe, Africa, and Asia.