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Devonian Partners, LLC (125 existing oil and gas wells)BackgroundMerits:
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Extensive property set – over 125 existing oil and gas wells located in West Texas and New Mexico
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Low risk development potential; properties currently producing from well established formations; significant upside potential to be realized though the application of the development capital raised
Challenges:
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Significant issues with the previous developer, including outstanding litigation, liens, and other claims
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Required assembling over 385 individual interests from over 1,100 individual investors
Objective
Consolidate the diverse holdings from a widely dispersed set of investors and arrange for the capital required to fully develop these resources. This is an interim strategy which will ultimately lead to a sale/monetization of this asset pool after the resource base has been brought on stream and the economic value of the underlying assets realized
Marathon Process
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We represented Devonian Partners as its exclusive Financial Advisor/Investment Banker.
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We assisted in structuring and executing the comprehensive exchange tender offer for interests held by over 385 individual investors.
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We developed detailed financial model of the new enterprise.
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We identified potential financing sources; developed marketing material and obtained commitments for permanent financing.
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We advised Devonian's Board of Directors in connection with all aspects of the exchange offer, recapitalization plan and financing negotiations. Outcome
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Successful conclusion of the Exchange Offer with almost 97% of potential Exchanging Members tendering their interests
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Closed $60 million oil & gas financing package, consisting of a $40 million senior secured tranche, a $16 million subordinated tranche and a $4 million contingent third lien tranche
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