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December 23, 2024
PI Global Investments
Private Equity

EIG explores Maverick’s sale valuing it at $3bn


The private equity owner of Maverick Natural Resources is exploring a potential sale that could value the U.S. oil and gas producer at nearly $3 billion, including debt, according to people familiar with the matter.

The Houston-based exploration and production company, which is owned by energy-focused investment firm EIG, is working with investment bankers at Jefferies(JEF.N) on the sale process, the sources said, requesting anonymity as the discussions are confidential.

Potential buyers, such as oil & gas producers and other investment firms, would have to take on nearly $800 million of Maverick’s debt, including the outstanding amount on an asset-backed securitization tied to some of its assets, the sources said, cautioning that no deal is guaranteed.

An asset-backed securitization is a financing structure where some assets of a company are used as collateral for the issuance of notes or bonds sold to investors. In the case of energy operators such as Maverick, the collateral is revenue tied to its future oil and gas production.

Such financing structures have been used by private oil and gas companies to fund operations amid a pullback in lending by some banks concerned by the industry’s environmental impact.
A potential deal for Maverick comes as a dealmaking boom sweeps through the U.S. shale industry. Large energy producers have been willing to splurge on deals to gain scale and snap up prime drilling sites, thus creating exit opportunities for buyout firms holding oil and gas assets.



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