Diversified Energy announced that it closed on a strategic transaction that has unlocked additional value from its existing asset base, the company announced on the 2nd January
In a nutshell, the company sold producing assets in Appalachia to a Special Purpose Vehicle (SPV) named DP Lion Equity Holdco LLC. In this innovative deal, Diversified retained a 20% minority interest and operational control of the assets.
The transaction yielded proceeds of approximately $200 million for Diversified, involving an Asset Backed Securitization placed at the SPV and an 80% equity interest sale in the SPV for around $30 million. The net proceeds were used to pay down outstanding borrowings under the company’s Sustainability-Linked Loan, resulting in an approximate 12% reduction in net debt. The remaining funds will be allocated for general corporate purposes.
Diversified Energy Company plc (LON:DEC), formerly Diversified Gas & Oil plc, is a gas and oil production company operating in the Appalachian Basin in the United States.
