Vital Energy, Inc.: M&A transaction — Vital Energy closes second $78M working-interest acquisition in Permian; increases 2024 FCF by $25M

Vital Energy, Inc.

Consideration of ~$78M comprised of ~879k shares of common and ~980k shares of 2.0% mandatorily convertible preferred stock.
Acquired 67% average working interest in 54 producing low-decline wells; adds 1,850 BOE/d (51% oil) to 2024 production.
Estimated 2024 free cash flow increase of ~$25 million; transaction accretive to FCF per share and supports deleveraging goals.
No further tag-along transactions anticipated; conversion of preferred requires stockholder approval at May 2024 meeting.

item 1.01 item 2.01 item 3.02 item 7.01 item 9.01

Key facts

Extracted from this filing and checked against the source text.

M&A Transactions SEC 8-K Item 2.01/5.01 confidence 0.9

Vital Energy, Inc. completed an acquisition involving PEP Henry Production Partners LP, PEP HPP Jubilee SPV LP, PEP PEOF Dropkick SPV, LLC, PEP HPP Dropkick SPV LP and HPP Acorn SPV LP for approximately 0.9 million shares of the Company's common stock, par value $0.01 per share, and approximately 1.2 million shares of the Company's 2.0% Cumulative (closed 2024-02-02).

Action: acquisition
Counterparty: PEP Henry Production Partners LP, PEP HPP Jubilee SPV LP, PEP PEOF Dropkick SPV, LLC, PEP HPP Dropkick SPV LP and HPP Acorn SPV LP
Consideration: approximately 0.9 million shares of the Company's common stock, par value $0.01 per share, and approximately 1.2 million shares of the Company's 2.0% Cumulative
Closing: 2024-02-02

Exact text from the filing

On February 2, 2024, the Company consummated the PEP Acquisition.

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.95

Vital Energy, Inc. entered into PEP PSA with PEP Henry Production Partners LP, PEP HPP Jubilee SPV LP, PEP PEOF Dropkick SPV, LLC, PEP HPP Dropkick SPV LP and HPP Acorn SPV LP valued at approximately 0.9 million shares of the Company's common stock… and … approximately 1.2 million shar (effective 2024-02-02).

Action: entry
Agreement: asset purchase
Counterparty: PEP Henry Production Partners LP, PEP HPP Jubilee SPV LP, PEP PEOF Dropkick SPV, LLC, PEP HPP Dropkick SPV LP and HPP Acorn SPV LP
Value: approximately 0.9 million shares of the Company's common stock… and … approximately 1.2 million shar
Effective: 2024-02-02

Exact text from the filing

On February 2, 2024, the Company entered into a purchase and sale agreement (the "PEP PSA") with PEP Henry Production Partners LP, PEP HPP Jubilee SPV LP, PEP PEOF Dropkick SPV, LLC, PEP HPP Dropkick SPV LP and HPP Acorn SPV LP (collectively, the "PEP Parties"), pursuant to which the Company agreed to purchase (the "PEP Acquisition") additional working interests in producing assets associated with the PEP Acquisition for consideration comprising (i) approximately 0.9 million shares of the Company's common stock, par value $0.01 per share ("Common Stock"), and (ii) approximately 1.2 million shares of the Company's 2.0% Cumulative Mandatorily Convertible Series A Preferred Stock, par value $0.01 per share (the "Preferred Stock" and such shares of Common Stock and Preferred Stock, collectively, the "Share Consideration") net of purchase price adjustments.

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Source: SEC EDGAR

accession 0001528129-24-000008

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