Viper Energy Partners LP (NASDAQ:VNOM) (“Viper” or the “Company”),
a subsidiary of Diamondback Energy, Inc. (NASDAQ:FANG)
(“Diamondback”), today announced its intent to convert its legal
status from a Delaware limited partnership into a Delaware
corporation. The conversion is expected to be completed by or
before December 31, 2023. After the conversion, it is expected that
Viper’s current limited partners would own the same percentage of
the corporation’s outstanding shares as they currently own of
Viper’s outstanding equity interests.
In connection with the conversion, Viper intends
to adopt a corporate governance structure designed to meet the
eligibility requirements for certain indices and benchmarks,
although no assurances can be provided regarding inclusion in any
such index or benchmark. Because Viper is already treated as a
corporation for U.S. federal income tax purposes, Viper expects
that the conversion of its entity form into a Delaware corporation
will not impact the current tax treatment for Viper’s current
public common unitholders.
Upon conversion, it is intended that Viper’s
common stockholders will have the ability to vote on all matters on
which stockholders of a corporation are generally entitled to vote
under the Delaware General Corporation Law, including the election
of Viper’s board of directors. Immediately following the proposed
conversion, Viper would be a “controlled company” under the rules
of NASDAQ because Diamondback would own more than 50% of the voting
power of Viper’s common stock. In addition, Diamondback intends to
continue to provide general and administrative services to Viper
post-conversion in substantially the same manner as Diamondback
currently provides. At or around the actual conversion, Viper
intends to provide additional information regarding the
post-conversion structural arrangements, including the terms of
Viper’s post-conversion governing documents and the arrangements
providing for Diamondback’s provision of services to Viper
post-conversion. It is expected that post-conversion, Viper’s
publicly traded common stock will be traded on NASDAQ under the
existing ticker symbol “VNOM.”
Travis Stice, Chief Executive Officer of Viper’s
General Partner, stated, “Today’s announcement of Viper’s intent to
convert into a Delaware corporation is an important step in the
growth and evolution of Viper. When completed, this conversion will
deliver increased corporate governance rights to our current
limited partners and is intended to position Viper such that the
value of our mineral and royalty assets can be fully recognized. We
plan to structure the converted Viper in a manner that that we
believe will enable index and benchmark inclusion, which we believe
would further broaden our investor base and improve Viper’s trading
liquidity,” stated Mr. Stice.
About Viper Energy Partners LP
Viper is a limited partnership formed by
Diamondback to own, acquire and exploit oil and natural gas
properties in North America, with a focus on owning and acquiring
mineral and royalty interests in oil-weighted basins, primarily the
Permian Basin. For more information, please visit
www.viperenergy.com.
About Diamondback Energy, Inc.
Diamondback is an independent oil and natural
gas company headquartered in Midland, Texas focused on the
acquisition, development, exploration and exploitation of
unconventional, onshore oil and natural gas reserves primarily in
the Permian Basin in West Texas. For more information, please visit
www.diamondbackenergy.com.
Forward-Looking Statements
This news release contains “forward-looking
statements” within the meaning of Section 27A of the Securities Act
and Section 21E of the Exchange Act, which involve risks,
uncertainties, and assumptions. All statements, other than
statements of historical fact, including statements regarding
Viper’s: future performance; business strategy; future operations;
estimates and projections of operating income, losses, costs and
expenses, returns, cash flow, and financial position; production
levels on properties in which Viper has mineral and royalty
interests, developmental activity by other operators; reserve
estimates and Viper’s ability to replace or increase reserves; our
intent to convert into a corporate structure and expectations
regarding the timing of such conversion, potential inclusion into
certain indices and benchmarks, trading liquidity, tax treatment
for our public unitholders post-conversion and related statements;
anticipated benefits of other strategic transactions (such as
acquisitions or divestitures); and plans and objectives of
(including Diamondback’s plans for developing Viper’s acreage and
Viper’s cash distribution policy and common unit repurchase
program) are forward-looking statements. When used in this news
release, the words “aim,” “anticipate,” “believe,” “continue,”
“could,” “estimate,” “expect,” “forecast,” “future,” “guidance,”
“intend,” “may,” “model,” “outlook,” “plan,” “positioned,”
“potential,” “predict,” “project,” “seek,” “should,” “target,”
“will,” “would,” and similar expressions (including the negative of
such terms) as they relate to Viper are intended to identify
forward-looking statements, although not all forward-looking
statements contain such identifying words. Although Viper believes
that the expectations and assumptions reflected in its
forward-looking statements are reasonable as and when made, they
involve risks and uncertainties that are difficult to predict and,
in many cases, beyond its control. Accordingly, forward-looking
statements are not guarantees of Viper’s future performance and the
actual outcomes could differ materially from what Viper expressed
in its forward-looking statements.
Factors that could cause the outcomes to differ
materially include (but are not limited to) the following: changes
in supply and demand levels for oil, natural gas, and natural gas
liquids, and the resulting impact on the price for those
commodities; the impact of public health crises, including epidemic
or pandemic diseases, and any related company or government
policies or actions; actions taken by the members of OPEC and
Russia affecting the production and pricing of oil, as well as
other domestic and global political, economic, or diplomatic
developments, including any impact of the ongoing war in Ukraine on
the global energy markets and geopolitical stability; instability
in the financial sector; concerns over economic slowdown or
potential recession; rising interest rates and their impact on the
cost of capital; regional supply and demand factors, including
delays, curtailment delays or interruptions of production on
Viper’s mineral and royalty acreage, or governmental orders, rules
or regulations that impose production limits on such acreage;
federal and state legislative and regulatory initiatives relating
to hydraulic fracturing, including the effect of existing and
future laws and governmental regulations; physical and transition
risks relating to climate change and the risks and other factors
disclosed in Viper’s filings with the Securities and Exchange
Commission, including its Forms 10-K, 10-Q and 8-K, which can be
obtained free of charge on the Securities and Exchange Commission's
web site at http://www.sec.gov.
In light of these factors, the events
anticipated by Viper’s forward-looking statements may not occur at
the time anticipated or at all. Moreover, the new risks emerge from
time to time. Viper cannot predict all risks, nor can it assess the
impact of all factors on its business or the extent to which any
factor, or combination of factors, may cause actual results to
differ materially from those anticipated by any forward-looking
statements it may make. Accordingly, you should not place undue
reliance on any forward-looking statements made in this news
release. All forward-looking statements speak only as of the date
of this news release or, if earlier, as of the date they were made.
Viper does not intend to, and disclaim any obligation to, update or
revise any forward-looking statements unless required by applicable
law.
Investor Contact:
Austen Gilfillian+1 432.221.7420agilfillian@viperenergy.com
Source: Viper Energy Partners LP; Diamondback Energy, Inc.
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