UPDATE 2-Five Point-backed LandBridge's shares soar as much as 24% in NYSE debut
LandBridge Co. LLC LB | 53.49 53.49 | +2.41% 0.00% Pre |
Dow Jones Industrial Average DJI | 42387.57 | +0.65% |
S&P 500 index SPX | 5823.52 | +0.27% |
NASDAQ IXIC | 18567.19 | +0.26% |
Adds background on company and IPO in paragraphs 4-6, 8-11
June 28 (Reuters) - Shares of LandBridge LB.N, a landowner in the oil-rich Permian Basin, jumped as much as 23.5% above their initial public offering price in their New York Stock Exchange debut on Friday.
The shares opened at $19 each, giving the Houston-based company a valuation of $1.37 billion. The stock rose as high as $21 and was last trading at $20.70.
The company raised $246.5 million by selling 14.5 million shares at $17 apiece, which was below its marketed range of $19 to $22.
The listing caps off a broadly strong quarter for the IPO market, which saw activity hit a two-year high anchored by some high-profile debuts.
LandBridge owns about 220,000 surface acres across Texas and New Mexico, located primarily in the heart of the Delaware sub-basin in the Permian Basin, the most active region for oil and natural gas exploration and development in the United States.
The land owner generates revenue from oil and natural gas royalties, and resource sales such as brackish water and surface-use royalties.
Founded in 2021 by private equity firm Five Point Energy, LandBridge also sold 750,000 shares in a concurrent private placement at the IPO price to raise nearly $12.8 million.
Certain funds and accounts managed by investment manager Horizon Kinetics Asset Management had expressed interest in buying up to $80 million worth of shares in the offering.
LandBridge's major customers include oil and gas companies ConocoPhillips COP.N, EOG Resources EOG.N, Occidental Petroleum OXY.N and Mewbourne Oil, as well as midstream water firm WaterBridge.
Five Point will indirectly own a majority of LandBridge's shares after the offering.
IPO proceeds will be used to pay down a portion of its debt and to make a distribution to Five Point.
The offering was underwritten by a syndicate of more than 10 Wall Street banks led by Goldman Sachs and Barclays Capital.
(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Vijay Kishore and Alan Barona)
((ArasuKannagi.Basil@thomsonreuters.com;))