Each one in plain English, with the numbers worked through for a shareholder.
5 Mar 2014asset acquisition disposition● NeutralMajor
On February 28, 2014 the partnership bought oil properties in Cimarron, Love and Texas Counties, Oklahoma and Potter County, Texas from affiliate Mid-Con Energy III for about $41.0 million, paid with about $7.0 million of borrowed cash and 1,500,000 new common units (valued at about $34.0 million). Issuing units adds to the unit count; the deal was approved by the independent conflicts committee, and it is a related-party deal, since the general partner's officers also hold positions at Mid-Con Energy III.
Third-quarter results and a bigger credit line on the same day: production up 32% year on year to 2,522 barrels equivalent a day, adjusted earnings before interest, tax, depreciation and exploration of $14.9 million, and a distribution of 51.5 cents a unit. The lender group lifted the borrowing base from $130 million to $150 million, pushed maturity out two years to November 2018 and added Bank of Nova Scotia - useful, given the partnership was down to $18.7 million of liquidity.
On November 26, 2012 the borrowing base under the $250 million credit agreement was raised from $100 million to $130 million, effective until the next redetermination, and Comerica Bank was added as a lender. This resolves the October 2012 borrowing base redetermination thread and gives the company more room to borrow.
The follow-on offering announced the day before was priced at $21.20 per unit: the partnership sells 1,000,000 new units and the Yorktown funds sell 3,000,000 (plus a 600,000-unit over-allotment option on Yorktown's side). The partnership expects about $20.2 million of net proceeds to repay credit facility borrowings and gets nothing from Yorktown's sale; closing is expected October 22, 2012. This resolves the open question on the offering's pricing.
On October 15, 2012 Mid-Con agreed to buy oil properties in its Hugoton Basin core area from Samson Resources for about $21 million (including a $2.1 million deposit), expected to close by November 6, 2012. It raised the quarterly distribution by $0.01 to $0.485 per unit ($1.94 annualized), and launched an offering of 1,000,000 new units by the partnership to repay credit facility borrowings, alongside 3,000,000 units sold by Yorktown, which would cut Yorktown's stake from about 48.5% to about 30.1%. It also said third-quarter production would land within guidance, likely toward the lower end. The press release describes two acquisitions totalling about $24.1 million.
On April 23, 2012 the credit facility was amended to raise the borrowing base from $75 million to $100 million, and Wells Fargo joined as an additional lender. The partnership also declared a first-quarter 2012 distribution of $0.475 per unit ($1.90 annualized), payable May 14, 2012 to holders of record May 7. The press release states about $55 million of availability against $45 million of debt outstanding at December 31, 2011.
23 Dec 2011asset acquisition disposition● NeutralMajor
The IPO of 5,400,000 common units at $18.00 closed on December 20, 2011, completing the offering priced the week before. At closing the partnership signed a Services Agreement under which Mid-Con Energy Operating provides management and operating services and is reimbursed for allocated expenses, and its subsidiary signed a five-year, $250 million revolving credit facility with Royal Bank of Canada as agent and an initial borrowing base of $75 million. The filing also covers the contribution and merger agreement and the long-term incentive plan; the text provided is truncated, so further details are not captured here.
Mid-Con Energy Partners signed the underwriting agreement for its IPO on December 14, 2011: 5,400,000 common units at $18.00 each, with a 30-day option for 810,000 more. Net proceeds of about $87.4 million are earmarked to pay about $105.7 million to holders of the predecessor companies (cash part of the merger consideration), repay $20.2 million of debt, and buy Cushing Field working interests and derivative contracts for about $6.0 million. Closing was expected December 20, 2011, and the public would own 30.0% of the partnership.
