Viper Energy, Inc. has closed a significant drop-down transaction, acquiring all equity interests in certain mineral and royalty interest-owning subsidiaries of Diamondback Energy, Inc. The total consideration for the drop-down consisted of $1.0 billion in cash and the issuance of 69,626,640 units representing limited liability company interests in the operating company and an equivalent number of shares of Viper’s class B common stock.
The mineral and royalty interests acquired by the operating company in the drop-down represent approximately 22,847 net royalty acres in the Permian Basin, with approximately 69% currently operated by Diamondback.
Viper funded the cash consideration for the drop-down with proceeds from a previously announced underwritten public offering of shares of its class A common stock completed on February 3, 2025, as well as borrowings under the operating company’s revolving credit facility.
Immediately following the completion of the drop-down, Diamondback beneficially owned approximately 53.7% of Viper’s outstanding voting common stock. The drop-down was approved by Viper’s audit committee and the full board of directors, as well as the majority of the company’s stockholders, other than Diamondback and its subsidiaries.
As a result of this transaction, Viper has expanded its holdings in the Permian Basin, a move that underlines its focus on owning and acquiring mineral and royalty interests in oil-weighted basins. As a result of these announcements, the company's shares have moved -1.9% on the market, and are now trading at a price of $41.27. If you want to know more, read the company's complete 8-K report here.
