Riverstone Holdings LLC, the Manager of Riverstone Energy Limited, has announced that it has agreed to the sale of 100% of the membership interests in Rock Oil Holdings LLC, a Denver- and Houston-based oil and gas company focused on the Permian Basin, to SM Energy Company (NYSE: SM), a US-based E&P company.
Rock Oil was formed in March 2014 with the strategy of applying Rock Oil’s land and technical expertise to the acquisition and development of assets in top-tier North American plays. Since formation, Rock Oil has entered into a series of acquisitions to establish a position of approximately 24,783 net acres in the Midland Basin of the Permian, producing approximately 4,900 boepd.
Under the terms of the transaction, Riverstone Energy will realize gross cash proceeds of approximately $237 million, representing a gross multiple of invested capital of 2.1x on the Company’s investment of $114 million. This represents a gain of $123 million and an uplift of $84 million or 55% above its carrying value of $152 million as at 30 June 2016, when investments within the Portfolio were last valued. The Company’s gross profit of $123 million will be subject to taxes and a performance fee upon closing of the sale, which is expected to occur in early October and is subject to customary closing conditions.
The Company will release its 2016 interim results, including the updated NAV as at 30 June 2016, on 11 August 2016.
RSE : Riverstone sells Rock Oil