Double Eagle Announces $6.4 Billion Divestiture in the Midland Basin

FORT WORTH, Texas–(BUSINESS WIRE)–Double Eagle III Midco 2 LLC (the “Company” or “Double Eagle”), wholly owned by DoublePoint Energy, LLC (“DoublePoint”), announced that it has entered into a definitive purchase agreement to sell all leasehold interests, subsidiaries and related assets to Pioneer Natural Resources Company (NYSE:PXD) (“Pioneer”). This transaction is valued at approximately $6.4 billion as of April 1, 2021, comprised of approximately 27.2 million shares of Pioneer common stock, $1 billion of cash and approximately $0.9 billion of debt and liabilities. The transaction was unanimously approved by the Board of Directors of each company and is expected to close in the second quarter of 2021, subject to customary closing conditions and regulatory approvals. Double Eagle is backed by equity commitments from funds managed by affiliates of Apollo Global Management, Inc. (NYSE: APO), Quantum Energy Partners, Magnetar Capital, and Blackstone Credit.

Transaction Details

Pioneer will issue approximately 27.2 million shares of common stock in the transaction with an additional $1 billion of cash. After closing, existing Pioneer shareholders will own approximately 89% of the combined company and existing DoublePoint owners will own approximately 11% of the combined company. Pioneer plans to finance the cash portion of the purchase price through a combination of cash on-hand and existing borrowing capacity under its revolving credit facility.

The transaction is structured as the acquisition by a Pioneer subsidiary of 100% of the limited liability company interests of DoublePoint’s wholly owned subsidiary, Double Eagle III Midco 1 LLC.

Cody Campbell and John Sellers, Co-CEO’s of DoublePoint said, “We are proud and appreciative of the work that our team has done to build a company and an asset base that is unparalleled in quality and truly cannot be replicated. We are honored to have the opportunity to combine our business with Pioneer, who we have long admired and regard as the premier operator in the Midland Basin. The fit and the synergies are clear, and we look forward to working with Pioneer to continue creating value.”

Geoffrey Strong, Senior Partner and Co-Head of Infrastructure and Natural Resources of Apollo, commented, “The combination of Pioneer and DoublePoint is compelling from both a financial and operational standpoint and a natural fit for DoublePoint. This acquisition continues the trend of consolidation in the prolific Permian Basin, combining two complementary footprints in a transaction with both top- and bottom-line synergies.”

Dheeraj Verma, President of Quantum Energy Partners added, “Quantum feels very fortunate to have had the opportunity to partner with John, Cody, Josh, Blake, Garrett and their team. Double Eagle built a truly world-class business through strong execution and unmatched creativity. Additionally, we are excited to be shareholders in Pioneer as we are firm believers in their strategy of free cash flow generation that enables a competitive base and strong variable dividend.”

Advisors

J.P. Morgan Securities LLC is serving as lead financial advisor to Double Eagle and sponsors, with Citi and RBC Capital Markets also acting as financial advisors. Vinson & Elkins LLP and Alston & Bird LLP are serving as legal advisors to Double Eagle.

About DoublePoint

DoublePoint is a Fort Worth, Texas based upstream oil and gas company, led by the Double Eagle management team in partnership with FourPoint Energy. DoublePoint is backed by equity commitments from funds managed by affiliates of Apollo Global Management, Inc., Quantum Energy Partners, Magnetar Capital, and Blackstone Credit.

About Apollo Global Management, Inc.

Apollo is a leading global alternative investment manager with offices in New York, San Diego, London, Houston, Bethesda, Los Angeles, Frankfurt, Luxembourg, Madrid, Singapore, Hong Kong, Tokyo, Shanghai, Delhi, and Mumbai. Apollo had assets under management of approximately $455 billion as of December 31, 2020 in its various affiliated private equity, credit, and real estate funds. For more information about Apollo, please visit www.apollo.com.

About Quantum Energy Partners

Founded in 1998, Quantum Energy Partners is a leading provider of private equity capital to the global energy industry, having managed together with its affiliates more than $17 billion in equity commitments since inception. For more information on Quantum, please visit www.quantumep.com. For investor relations, please contact Michael Dalton at (713) 452-2000.

About Magnetar Capital

Founded in 2005, Magnetar is a leading alternative asset manager with approximately $12.9 billion in assets under management as of January 2021. Magnetar’s Energy and Infrastructure Group has actively invested in the North American energy and infrastructure sector for 15+ years and has committed over $6 billion across more than 60 private energy, infrastructure and renewables investments. The firm is based in Evanston, Illinois and has offices in London and Houston.

Forward-Looking Statements

This press release contains forward-looking statements based on Double Eagle’s current expectations that involve a number of risks and uncertainties. Generally, forward-looking statements do not relate strictly to historical or current facts and may include words such as “believes,” “will,” “expects,” “anticipates,” “intends” or similar words or phrases. Forward-looking statements in this press release include, but are not limited to, statements regarding the proposed offering and the intended use of proceeds. No forward-looking statement can be guaranteed. Numerous risks, uncertainties and other factors may cause actual results to differ materially from those expressed in any forward-looking statement.

Contacts

Patrick Leach

Corporate Development – Investor Relations

investorrelations@depermian.com