Money losing natgas producer BKV revives US IPO
BKV Corp, a natural gas producer in the red, said it plans to raise $315 million via an initial public offer of shares. This comes nearly two years after BKV first filed to sell its shares publicly.
BKV said it will offer between $19 to $21 per share. The company aims to achieve a valuation up to $1.77bn in its IPO.
Companies waiting to list shares have a new window of opportunity due to the recent increase in natural gas prices in the United States from their more than 30-year low inflation adjusted.
This company was one of the U.S. producers who were hard hit by low natural gas prices during the past two years. Oil companies, which pump gas as an by-product, increased supplies and drove prices down in West Texas and Arizona.
BKV received funding commitments from Banpu Plc last year to meet financial obligations until June 30, 2025 after it was unable to comply with certain lender's conditions.
Cash and cash-equivalents were $9.2 millions at the end the first half this year. This compares to $22.4 million a year ago.
It reported a net loss in the first six months of the year of $98.3 millions, compared to a profit in the same period of 2023 of $60.8million.
According to the company's filing with the market regulators, the Denver-based firm, which operates in Texas' Barnett shale as well as Pennsylvania's Marcellus shale has plans to use approximately $230 million from its net proceeds to repay debt, and the remainder for capital expenditures and general corporate purposes.
The company's stock will be traded on the New York Stock Exchange with the symbol "BKV."
Citigroup and Barclays will be the leading book-running managers of the offering. Both were not available to comment immediately.
Citi reserves up to 5% shares for the sale of BKV employees, directors and associates at the IPO prices. These shareholders will have to adhere to lock-ups ranging between 60 and 180 days. (Reporting and editing by Tasim Zaid in Bengaluru, with Niket Nishant from Bengaluru)
(source: Reuters)
