LandBridge Company gears up to raise $319 million in US IPO

LandBridge Company LLC, which is engaged in the acquisition of oil properties, is preparing to become a public entity by listing on the New York Stock Exchange through an initial public offering. The IPO filing comes at a time when the market is witnessing a rush of public listings led by technology and healthcare companies.

The Offering

LandBridge Company intends to sell around 14.5 million shares in the initial public offering, and its Class A shares will trade on the New York Stock Exchange under the symbol LB.  The estimated offer price is in the range of $19.00 per share to $22.00 per share. At the high point of the offer price, the IPO will generate around $319 million. The group of underwriters for the offering is led by Goldman Sachs & Co. and Barclays.

The management plans to contribute all of the net proceeds from the offering to DBR Land Holdings, the operating company (OpCo), in exchange for its newly issued units. Of that, $100 million will be used for repaying outstanding borrowings under a credit facility. The remainder of the proceeds will be used mainly to make a distribution to LandBridge Holdings, which will directly control the company following the offering.

Company

LandBridge Company was formed in September 2023 and owns around 22,000 surface acres in the Delaware sub-basin of the oil-rich Permian basin, the most active region for energy exploration in the US. As part of its expansion program, last month the company acquired around 103,000 surface acres in Loving and Winkler Counties in Texas, and Lea County in New Mexico. In addition, another 34,000 surface acres were acquired in Lea County in New Mexico, and Andrews County in Texas.

For fiscal 2023, LandBridge Company reported revenues of $92.9 million on a proforma basis. In the previous year, the company’s predecessor generated revenues of $51.78 million. Adjusted EBITDA was $82.37 million in FY23 when the net income margin came in at 55%. At the end of March 2024, the company had a total debt outstanding of $400.4 million, on a pro forma basis, mainly reflecting recent acquisitions of various assets.