REG - Diversified Energy - Pricing of Offering of Ordinary Shares

Diversified EnergyAnnouncement

20/02/2025 07:15

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250220:nRST8433Xa&default-theme=true

RNS Number : 8433X  Diversified Energy Company PLC  20 February 2025

February 20, 2025

 

Diversified Energy Company PLC

("Diversified" or the "Company")

 

Diversified Energy Announces Pricing of Offering of Ordinary Shares

 

Diversified Energy Company PLC (LSE: DEC; NYSE: DEC) ("Diversified" or the
"Company"), an independent energy company focused on natural gas and liquids
production, transportation, marketing and well retirement, today announces the
pricing of its previously announced underwritten public offering (the
"Offering") of 8,500,000 ordinary shares (the "Shares") at a public offering
price of $14.50 per Share for total gross proceeds of approximately $123.3
million. The Offering is expected to settle on February 21, 2025, subject to
customary closing conditions. In addition, Diversified has granted the
underwriters a 30-day option to purchase up to an additional 850,000 ordinary
shares at the public offering price, less underwriting discount.

 

Citigroup and Mizuho are acting as joint book-running managers and
underwriters for the Offering. KeyBanc Capital Markets, Truist Securities,
Jefferies and Raymond James are also acting as joint book-running managers and
underwriters for the Offering. Johnson Rice & Company, Pickering Energy
Partners, Stephens Inc. and Stifel are acting as co-managers and underwriters
for the Offering.

 

The Company intends to use the net proceeds from the Offering to repay a
portion of the debt expected to be incurred by the Company in connection with
the proposed acquisition of Maverick Natural Resources, LLC, as announced on
January 27, 2025 (the "Acquisition"). In the event that the Acquisition does
not close, the Company intends to use the net proceeds from the Offering to
repay debt and for general corporate purposes. The consummation of the
Offering is not conditioned upon the completion of the Acquisition, and the
completion of the Acquisition is not conditioned upon the consummation of the
Offering.

 

A shelf registration statement relating to these securities was filed with the
U.S. Securities and Exchange Commission (the "SEC") on February 11, 2025 and
became effective upon filing. Copies of the registration statement can be
accessed through the SEC's website free of charge at www.sec.gov. A
preliminary prospectus supplement and an accompanying prospectus relating to
and describing the terms of the Offering were filed with the SEC and are
available free of charge by visiting EDGAR on the SEC's website at
www.sec.gov. When available, copies of the final prospectus supplement and the
accompanying prospectus related to the Offering can be accessed through the
SEC's website free of charge at www.sec.gov or obtained free of charge from
either of the joint book-running managers for the Offering: Citigroup, c/o
Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717
(Tel: 800-831-9146); or Mizuho Securities USA LLC, Attention: Equity Capital
Markets Desk, at 1271 Avenue of the Americas, New York, NY 10020, or by email
at US-ECM@mizuhogroup.com.

 

This announcement does not constitute an offer to sell or the solicitation of
an offer to buy our ordinary shares nor shall there be any sale of securities,
and shall not constitute an offer, solicitation or sale in any jurisdiction in
which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of that jurisdiction.

 

In connection with the admission of the Shares to listing on the equity shares
(commercial companies) category of the Official List of the Financial Conduct
Authority and to trading on the main market for listed securities of the
London Stock Exchange ("Admission"), the Company intends to publish a
prospectus as required under the UK version of Regulation (EU) 2017/1129 as it
forms part of UK law by virtue of the European Union (Withdrawal) Act 2018.
Applications will be made to the FCA and LSE for Admission, and Admission is
expected to become effective at 8:00 am (London time) on February 24, 2025.

 

Post Transaction Report

 

In accordance with the Statement of Principles (November 2022) published by
the Pre-Emption Group, Diversified announces the following post transaction
report in connection with the Offering.

 

 Name of Issuer         Diversified Energy Company PLC
 Transaction Details    The Company issued 8,500,000 new Ordinary Shares (the "Shares"), representing
                        16.6% of the Company's ordinary share capital as of 14 February 2025.

                        Admission of the Shares representing 16.6% of the Company's ordinary share
                        capital as of 14 February 2024 is expected to occur at 8.00 am (London
                        time) on 24 February 2024.

 Use of Proceeds        The directors of the Company intend to use the net proceeds from the Offering
                        to repay a portion of the debt expected to be incurred by the Company in
                        connection with the proposed acquisition of Maverick Natural Resources, LLC,
                        as announced on 27 January 2025 (the "Acquisition"). In the event that the
                        Acquisition does not close, the Company intends to use the net proceeds from
                        the Offering to repay debt and for general corporate purposes.

 Quantum of Proceeds    Total gross proceeds from the Offering, amounted to US$123.3
                        million (approximately £97.9 million), approximately US$118.3 million net
                        of expenses (approximately £93.9 million net of expenses).

 Discount               The Offering was completed at a price of US$14.50 per Share, representing a
                        3.4% percent discount from the NYSE closing price of US$15.01 per Share on 19
                        February 2025 (being the last business day prior to the pricing of the
                        Offering).

 Allocations            Soft pre-emption has been adhered to in the allocations process, where
                        possible. Management was involved in the allocations process, which has been
                        carried out in compliance with the MIFID II Allocation requirements.

 Consultation           The Underwriters undertook a pre-launch wall-crossing process, including
                        consultation with major shareholders, to the extent reasonably practicable and
                        permitted by law.

 U.K. Retail Investors  Following discussions between the Underwriters and the Company, it was decided
                        that a retail offer would not be included in the Offering. The Offering
                        structure was chosen to minimize cost, time to completion and complexity.

 

CONTACTS

 

 Diversified Energy Company PLC                                             +1 973 856 2757
 Doug Kris                                                                 dkris@dgoc.com
 Senior Vice President, Investor Relations & Corporate Communications

 FTI Consulting                                                            dec@fticonsulting.com
 U.S. & UK Financial Media Relations

 

About Diversified

 

Diversified is a leading publicly traded energy company focused on natural gas
and liquids production, transport, marketing, and well retirement. Through our
unique differentiated strategy, we acquire existing, long-life assets and
invest in them to improve environmental and operational performance until
retiring those assets in a safe and environmentally secure manner. Recognized
by ratings agencies and organizations for our sustainability leadership, this
solutions-oriented, stewardship approach makes Diversified the Right Company
at the Right Time to responsibly produce energy, deliver reliable free cash
flow, and generate shareholder value.

 

Forward-Looking Statements

 

This press release includes forward-looking statements. Forward-looking
statements are sometimes identified by the use of forward-looking terminology
such as "believe", "expects", "targets", "may", "will", "could", "should",
"shall", "risk", "intends", "estimates", "aims", "plans", "predicts",
"continues", "assumes", "projects", "positioned" or "anticipates" or the
negative thereof, other variations thereon or comparable terminology. These
forward-looking statements include all matters that are not historical facts.
They appear in a number of places throughout this announcement and include
statements regarding the intentions, beliefs or current expectations of
management or the Company concerning, among other things, expectations
regarding the proposed Offering of securities and the Acquisition. These
forward-looking statements involve known and unknown risks and uncertainties,
many of which are beyond the Company's control and all of which are based on
management's current beliefs and expectations about future events, including
market conditions, failure of customary closing conditions and the risk
factors and other matters set forth in the Company's filings with the SEC and
other important factors that could cause actual results to differ materially
from those projected.

 

Important Notice to UK and EU Investors

 

This announcement contains inside information for the purposes of Regulation
(EU) No. 596/2014 on market abuse and the UK Version of Regulation (EU) No.
596/2014 on market abuse, as it forms part of UK domestic law by virtue of the
European Union (Withdrawal) Act 2018 (together, "MAR"). In addition, market
soundings (as defined in MAR) were taken in respect of the matters contained
in this announcement, with the result that certain persons became aware of
such inside information as permitted by MAR. Upon the publication of this
announcement, the inside information is now considered to be in the public
domain and such persons shall therefore cease to be in possession of inside
information in relation to the Company and its securities.

 

Members of the public are not eligible to take part in the Offering. This
announcement is directed at and is only being distributed to persons: (a) if
in member states of the European Economic Area, "qualified investors" within
the meaning of Article 2(e) of Regulation (EU) 2017/1129 (the "Prospectus
Regulation") ("Qualified Investors"); or (b) if in the United Kingdom,
"qualified investors" within the meaning of Article 2(e) of the UK version of
Regulation (EU) 2017/1129 as it forms part of UK law by virtue of the European
Union (Withdrawal) Act 2018, who are (i) persons who fall within the
definition of "investment professionals" in Article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended
(the "Order"), or (ii) persons who fall within Article 49(2)(a) to (d) of the
Order; or (c) persons to whom they may otherwise lawfully be communicated
(each such person above, a "Relevant Person"). No other person should act or
rely on this announcement and persons distributing this announcement must
satisfy themselves that it is lawful to do so. This announcement must not be
acted on or relied on by persons who are not Relevant Persons, if in the
United Kingdom, or Qualified Investors, if in a member state of the EEA. Any
investment or investment activity to which this announcement or the Offering
relates is available only to Relevant Persons, if in the United Kingdom, and
Qualified Investors, if in a member state of the EEA, and will be engaged in
only with Relevant Persons, if in the United Kingdom, and Qualified Investors,
if in a member state of the EEA.

 

No offering document or prospectus will be available in any jurisdiction in
connection with the matters contained or referred to in this announcement in
the United Kingdom and no such offering document or prospectus is required (in
accordance with the Prospectus Regulation or UK Prospectus Regulation) to be
published. The Company will publish a prospectus in connection with Admission
as required under the UK Prospectus Regulation in due course.

 

Neither the content of the Company's website (or any other website) nor the
content of any website accessible from hyperlinks on the Company's website (or
any other website) is incorporated into, or forms part of, this announcement.

 

The Company has consulted with a number of existing shareholders and other
investors ahead of the release of this announcement, including regarding the
rationale for the offering. Consistent with each of its prior offerings, the
Company will respect the principles of pre-emption, so far as is possible,
through the allocation process, in the Offering.

 

In connection with the Offering, Citigroup or any of its agents, may (but will
be under no obligation to), to the extent permitted by applicable law,
over-allot Shares or effect other transactions with a view to supporting the
market price of the Shares at a higher level than that which might otherwise
prevail in the open market. Citigroup may, for stabilization purposes,
over-allot Shares up to a maximum of 10 per cent. of the total number of
Shares comprised in the Offering. Citigroup will not be required to enter into
such transactions and such transactions may be effected on any stock market,
over-the-counter market, stock exchange or otherwise and may be undertaken at
any time during the period commencing on the date of adequate public
disclosure of the final price of the securities and ending no later than 30
calendar days thereafter. However, there will be no obligation on Citigroup or
any of its agents to effect stabilizing transactions and there is no assurance
that stabilizing transactions will be undertaken. Such stabilizing measures,
if commenced, may be discontinued at any time without prior notice. In no
event will measures be taken to stabilize the market price of the Shares above
the offer price. Save as required by law or regulation, neither Citigroup nor
any of its agents intends to disclose the extent of any over-allotments made
and/or stabilization transactions conducted in relation to the Offering.

 

Citigroup and Mizuho are acting exclusively for the Company and no one else in
connection with the Offering and will not regard any other person as their
respective clients in relation to the Offering and will not be responsible to
anyone other than the Company for providing the protections afforded to their
respective clients or for giving advice in relation to the Offering or the
contents of this announcement or any transaction, arrangement or other matter
referred to herein.

 

In connection with the Offering, Citigroup and Mizuho or any of their
respective affiliates, acting as investors for their own accounts, may
subscribe for or purchase Shares and in that capacity may retain, purchase,
sell, offer to sell or otherwise deal for their own accounts in such Shares
and other securities of the Company or related investments in connection with
the Offering or otherwise. Accordingly, references in the US prospectus, once
published, to the Shares being issued, offered, subscribed, acquired, placed
or otherwise dealt in should be read as including any issue or offer to, or
subscription, acquisition, placing or dealing by, Citigroup and Mizuho or any
of their respective affiliates acting as investors for their own accounts.
Citigroup and Mizuho or any of their respective affiliates do not intend to
disclose the extent of any such investment or transactions otherwise than in
accordance with any legal or regulatory obligations to do so.

 

Neither Citigroup nor Mizuho, nor any of their respective subsidiary
undertakings, affiliates or any of their respective directors, officers,
employees, advisers, agents or any other person accepts any responsibility or
liability whatsoever for, or makes any representation or warranty, express or
implied, as to the truth, accuracy, completeness or fairness of the
information or opinions in this announcement (or whether any information has
been omitted from the announcement) or any other information relating to the
Company, its subsidiaries or associated companies, whether written, oral or in
a visual or electronic form, and howsoever transmitted or made available or
for any loss howsoever arising from any use of this announcement or its
contents or otherwise arising in connection therewith.

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  IOEGXGDDSSDDGUG