Riverstone Energy has built up a cash balance of $123m and plans to use about $100m (£80m) of that to fund a tender offer.
The company will buy back up to 13,840,830 shares at 578p per share. That is the equivalent of 30.4% of the company’s issued share capital.
The tender price is equal to the closing market price on 16 August 2023 and represents a 43.5% discount to NAV.
[QD comment: This will be a real test of how desperate investors are for liquidity. 43.5% is an enormous discount for a tender offer and represents a considerable transfer of value from existing to ongoing shareholders. If the tender was taken up in full, all else being equal, the NAV would rise from 1023p to 1217p.]
The record date for participation in the tender offer is 6.00 p.m. on 26 September 2023. There will be a meeting to approve it – scheduled for 27 September. The effective repurchase date will be 29 september and selling shareholders should be getting their cash around 6 October.
RSE : Riverstone Energy planning 30% tender