June 3, 2024
Diversified Energy Company
PLC
("Diversified" or the "Company")
Diversified Closes Market
Leading Securitized Financing
Solidifies Standing as the
First, Largest and Consistent Performing Issuer of PDP Oil &
Gas Securitizations
Diversified Energy Company PLC
(LSE:DEC, NYSE:DEC) is pleased to announce that on May 30, 2024,
the Company closed on an asset backed securitization ("ABS")
refinancing, creating the ABSVIII note (the "Transaction").
Diversified will use the proceeds from the Transaction to repay the
outstanding principal of the previously issued ABSIII and ABSV
notes, retiring those notes from the Company's outstanding debt.
The additional proceeds from the Transaction will be used to reduce
outstanding borrowings under the Company's revolving credit
facility and for general corporate purposes. As previously
announced on March 19, 2024, the Company intends to fund a portion
of the acquisition of the working interests from Oaktree Capital
Management using the Company's revolving credit facility
The Transaction is backed by
collateral securing the ABSIII and ABSV notes representing working
interest in Proved Developed Producing ("PDP") wells. The
Transaction was significantly oversubscribed with over $1.7 billion
in orders from a broad group of 18 unique
investors.
Transaction Highlights
Key Terms
• ABSVIII
note amount of $610 million (gross)
◦ Net
proceeds of $592 million, inclusive of fees, expenses and interest
reserve
• Blended
fixed coupon of 7.28%
• Fully
amortized expected maturity of March 2033
•
Investment-grade ratings for note ABSVIII Class A-1 and A-2 (Fitch
Ratings, Inc.)
◦ Class A-1:
A rating
◦ Class A-2:
BBB+ rating
Sustainability-Linked
Sustainable Fitch has again-provided
a Second Party Opinion that the instrument's Key Performance
Indicators (the "KPIs") align with the International Capital
Markets Association (ICMA) framework for sustainability-linked bond
principles, highlighting Diversified's commitment to aligning its
financing with the Company's overall sustainability
strategy.
Rusty Hutson, Jr., CEO of the
Company, commented:
"This transaction marks the eighth ABS since the start of our
securitization program in 2019 and signals the confidence in the
Diversified business model from the energy structured finance
community as well as with the broader capital markets. The
transaction was well received by both new and existing investors
delivering high demand from the largest order book for an oil and
gas securitization. The offering was assigned the first flat "A"
rating on an operated PDP securitization and allowed for the
Company to achieve an extremely competitive cost of capital. We
believe that the record-breaking transaction will change the way
people in the energy sector think about this product and the
successful execution showcases Diversifieds ability to provide
reliable production and consistent cash flows."
Barclays Capital, Inc. acted as Sole
Structuring Agent, Sole Ratings Advisor, and Left Lead Placement
Agent.
For further information, please
contact:
Diversified Energy Company PLC
|
+1
973 856 2757
|
Doug Kris
|
dkris@dgoc.com
|
Senior Vice President, Investor
Relations & Corporate Communications
|
www.div.energy
|
|
|
FTI
Consulting
|
dec@fticonsulting.com
|
U.S. & UK Financial Public
Relations
|
|
About Diversified Energy Company PLC
Diversified is a leading publicly
traded energy company focused on natural gas and liquids
production, transport, marketing, and well retirement. Through our
differentiated strategy, we acquire existing, long-life assets and
invest in them to improve environmental and operational performance
until retiring those assets in a safe and environmentally secure
manner. Recognized by ratings agencies and organizations for our
sustainability leadership, this solutions-oriented, stewardship
approach makes Diversified the Right Company at the Right Time to
responsibly produce energy, deliver reliable free cash flow, and
generate shareholder value.
Forward-Looking Statements
This announcement contains
forward-looking statements (within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995). These forward-looking
statements, which contain the words "anticipate", "believe",
"intend", "estimate", "expect", "may", "will", "seek", "continue",
"aim", "target", "projected", "plan", "goal", "achieve" and words
of similar meaning, reflect the Company's beliefs and expectations
and are based on numerous assumptions regarding the Company's
present and future business strategies and the environment the
Company will operate in and are subject to risks and uncertainties
that may cause actual results to differ materially. No
representation is made that any of these statements or forecasts
will come to pass or that any forecast results will be achieved.
Forward-looking statements involve inherent known and unknown
risks, uncertainties and contingencies because they relate to
events and depend on circumstances that may or may not occur in the
future and may cause the actual results, performance or
achievements of the Company to be materially different from those
expressed or implied by such forward looking statements. Many of
these risks and uncertainties relate to factors that are beyond the
Company's ability to control or estimate precisely, including the
risk factors described in the "Risk Factors" section in the
Company's Annual Report and Form 20-F for the year ended December
31, 2023, filed with the United States Securities and Exchange
Commission. Forward-looking statements speak only as of their date
and neither the Company nor any of its directors, officers,
employees, agents, affiliates or advisers expressly disclaim any
obligation to supplement, amend, update or revise any of the
forward-looking statements made herein, except where it would be
required to do so under applicable law. As a result, you are
cautioned not to place undue reliance on such forward-looking
statements.