Viper Energy Files to Sell 203.17M Shares of Class A Common Stock

Viper Energy has filed to sell 203.17M shares of Class A common stock for holders.

Viper Energy, Inc. (VNOM), a subsidiary of Diamondback Energy, Inc. (FANG), has announced plans to sell 203.17 million shares of its Class A common stock. The move comes in the wake of the company's recent acquisition of Sitio Royalties Corp., which has significantly bolstered its production outlook and financial position.

Following the acquisition, Viper Energy revised its third-quarter 2025 production guidance to reflect Sitio's contribution. The company now expects average oil production to range between 54,500 to 57,500 barrels per day, an increase of approximately 8,500 barrels per day compared to its previous standalone projections. Average total production is projected to be in the band of 104,000 to 110,000 barrels of oil equivalent per day, representing an increase of about 18,000 barrels of oil equivalent per day from the earlier guidance [1].

The acquisition of Sitio Royalties has positioned Viper Energy as a leader in the minerals and royalties space, offering greater size, scale, liquidity, and access to investment-grade capital. Kaes Van’t Hof, CEO of Viper Energy, highlighted the merger as a pivotal step for the industry, noting the company's continued alignment with Diamondback Energy [1].

To fund the acquisition and subsequent capital expenditures, Viper Energy has issued $1.6 billion in new unsecured notes. This move has pushed out the company's next note maturity to 2030 and saved it approximately $25 million per year in interest costs. The debt restructuring also includes the issuance of $500 million in 4.9% unsecured notes due 2030 and $1.1 billion in 5.7% unsecured notes due 2035, while redeeming $380 million in 5.375% unsecured notes due 2027 and $400 million in 7.375% unsecured notes due 2031 [2].

Looking ahead, Viper Energy expects its 2026 production to increase by mid-single digits from its current level of around 126,000 BOEPD. The company is projecting 2026 production at around 132,000 BOEPD, including 68,000 barrels of oil per day. This would represent a 5% increase in total production and a 3% increase in oil production compared to Viper's 2025 production post-Sitio close [2].

The sale of 203.17 million shares of Class A common stock is a strategic move that aligns with Viper Energy's growth objectives. The company aims to capture long-term growth opportunities, deliver efficiencies from greater scale, and continue providing value to shareholders while maintaining its close alignment with Diamondback Energy. The stock sale is expected to generate substantial capital for the company, enabling it to invest in further expansion and operational enhancements.

References:

[1] https://www.nasdaq.com/articles/viper-energy-closes-sitio-deal-raises-q3-production-outlook
[2] https://seekingalpha.com/article/4816670-viper-energy-expects-continued-production-growth-after-sitio-acquisition