Covey Park Energy Holdings, a Denham Capital portfolio company, said Monday, April 24, that it has confidentially submitted a draft registration statement on Form S-1 to the U.S. Securities and Exchange Commission relating to its proposed initial public offering.
Earlier this month, TheStreet reported that Covey Park was expected by industry sources to IPO in 2017, but also may have received takeover interest from larger nearby operators.
Many auctions in recent months have been dual-track, meaning the company has hired bankers to simultaneously explore both a sale of the business and an IPO. Monday's filing does not necessarily mean the company couldn't still be acquired, but industry sources have in particular long-expected Covey Park, given its extensive holdings in the Haynesville Shale, a natural gas play in eastern Texas and northwestern Louisiana, along with its strong financial support, to go public.
Covey Park said Monday that the size and the price range for the proposed offering have not yet been determined. The offering is expected to commence in 2017, and is subject to completion of the SEC review process and market conditions, among other things, the company said.
Dallas-based Covey Park added that there is no assurance that the IPO will be consummated. The announcement follows the IPO filing of another Haynesville-focused operator, Vine Resources.
The Plano, Texas-based natural gas producer on April 10 filed initial IPO paperwork with the Securities and Exchange Commission with a $500 million placeholder. Vine, a Blackstone Group (BX) - Get Blackstone Group Inc. Class A Report portfolio company, revealed that Credit Suisse Group and Morgan Stanley are the lead underwriters on its offering. The company intends to list on the NYSE under the ticker symbol VRI.
Vine bought much of its Haynesville acreage from Royal Dutch Shell (RDS.A) in 2014 for $1.2 billion.
Meanwhile, as previously reported by TheStreet, another IPO sources anticipate in the coming months is Indigo Minerals, which received $300 million in new backing from Trilantic Capital Management in April 2016 along with another $75 million in commitments from existing investors Martin Cos., Yorktown Partners and Ridgemont Equity Partners.
Houston-based Indigo also has been named by sources as the buyer in Chesapeake Energy's (CHK) - Get Chesapeake Energy Corporation Report $450 million Haynesville asset sale announced this past December. Covey Park then went on to acquire Chesapeake's remaining noncore Haynesville properties later that month for $465 million. Indigo did not return a request for comment from TheStreet's sister site, The Deal.
Rumblings have also surfaced that privately held Aethon Energy Management could bring its Hayneville properties to the public markets, though sources are not aware of any imminent plans. Aethon was founded in 1990 by Albert Huddleston, a former landman for Hunt Energy. Aethon is majority management owned but formed a partnership with Ontario Teachers' Pension Plan and Redbird Capital Partners last summer called Aethon United. Aethon declined to comment on its plans.
Finally, there is the question as to when Haymaker Minerals & Royalties will attempt to go public. Several sources have said the company is widely expected to IPO shortly, but some of these people told The Deal in February that Haymaker is shopping high-upside value properties in various U.S. basins, including the Midland, ahead of the IPO, as yield investors won't give them market value for these assets. Haymaker has not responded to multiple requests for comment.