Vantage Energy, an oil and gas E&P operating in the Marcellus Shale, announced terms for its IPO on Monday. The Englewood, CA-based company plans to raise $601 million by offering 23.6 million shares (33% insider) at a price range of $24 to $27. At the midpoint of the proposed range, Vantage Energy would command a fully diluted market value of $1.9 billion.
Primary shareholders include Quantum Energy Partners, Riverstone and Lime Rock, which together will own a 66% post-IPO stake in the company.
Vantage owns 96,000 acres in the Marcellus (60% net acreage) and Barnett (40%) Shale formations. The company's average net daily total production has grown to 150 MMcfe/d, up from 63 MMcfe/d at the end of 2013. For the six months ended June 30, 2014, the company derived its revenue from three operating sources, including natural gas (73%), NGLs (15%) and oil (12%).
Vantage Energy's predecessor revenue increased 50% to $41 million for the six months ended June 30, 2014. Total production increased from 7,600 MMcfe to 8,600 MMcfe and average realized prices after hedges increased 19% as Vantage saw higher production and prices across its three segments. Adjusted EBITDA grew 40% to $22 million as the company gained operating leverage. Vantage ramped up its borrowing, more than doubling its debt to $237 million ($335 million after its corporate reorganization), which led to an interest expense of $8 million from $0 in the prior year period.
Vantage Energy, which was founded in 2006 and booked $48 million in sales for the 12 months ended June 30, 2014, plans to list on the NYSE under the symbol VEI. Barclays, Goldman Sachs, Citi, Credit Suisse, Tudor, Pickering, Holt and Wells Fargo Securities are the joint bookrunners on the deal. It is expected to price on Wednesday, September 24, 2014.
