Civitas Resources, Inc. Announces Secondary Public Offering of Common Stock By An Affiliate of Canada Pension Plan Investment Board
Civitas Resources announced a secondary public offering of 6,956,520 shares of its common stock by an affiliate of Canada Pension Plan Investment Board (CPP). Civitas will not sell any shares or receive proceeds from the sale. BofA Securities is the sole underwriter for the offering, with an option to purchase an additional 1,043,478 shares within 30 days. The offering can involve transactions on the NYSE, over-the-counter markets, or negotiated sales at market or related prices. A registration statement with the SEC is effective, and the offering will proceed via a prospectus supplement and base prospectus. No securities will be sold where unlawful.
- Underwritten public offering led by BofA Securities, a reputable financial institution.
- Potential liquidity and increased market visibility for Civitas shares.
- Effective SEC registration statement, ensuring regulatory compliance.
- Civitas will not receive any proceeds from the stock sale.
- Potential dilution of share value due to a large volume of shares being offered.
- Selling by a significant stakeholder, such as CPP, could be perceived as a lack of confidence in Civitas.
Insights
This announcement primarily pertains to a secondary public offering by an affiliate of the Canada Pension Plan Investment Board (CPPIB), not Civitas Resources itself. The company will not receive any proceeds from this transaction, which means the capital structure of the company remains unchanged. However, the market dynamics could shift as a considerable number of shares, 6,956,520, are being introduced by the selling stockholder.
Short-term implications: The influx of shares into the market might lead to downward pressure on Civitas' stock price due to increased supply. Investors should watch trading volumes and price movements closely during this period. BofA Securities serving as the sole underwriter signifies market confidence, but the underwriter's 30-day option to purchase additional shares introduces some uncertainty.
Long-term considerations: It's essential to consider why CPPIB is divesting. If it is a routine rebalancing of their portfolio, it might not be a negative signal. However, if it's due to concerns about Civitas' future performance, that could be a red flag. Retail investors should also take note of any changes in major shareholder structures, as shifts can indicate broader strategic moves or shifts in confidence.
From a market perspective, this offering highlights the liquidity and attractiveness of Civitas Resources' common stock. For retail investors, the secondary offering does not dilute existing shares, which is typically a positive aspect. However, the selling activity by a major institutional investor like CPPIB could be interpreted cautiously.
Investor Sentiment: Large sales by institutional investors can sometimes signal to the market potential concerns or a reallocation of investments to different opportunities. Monitoring market reactions post-offering will be key. If the stock absorbs the new supply without significant price drops, it could signal underlying strength in investor confidence.
Market Trends: The involvement of BofA Securities and their ability to sell these shares across different platforms (NYSE, over-the-counter, etc.) is indicative of Civitas Resources' market adaptability and demand breadth. This flexibility in selling channels might help stabilize prices by reaching a broader investor base.
BofA Securities is acting as sole underwriter for the Offering. The underwriter may offer the shares of common stock from time to time for sale in one or more transactions on the New York Stock Exchange, in the over-the-counter market, through negotiated transactions, or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices, or at negotiated prices. The underwriter will have a 30-day option to purchase up to an additional 1,043,478 shares of common stock from the Selling Stockholder.
A registration statement relating to these securities has been filed with the
This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be any sale of any securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
About Civitas
Civitas Resources, Inc. is an independent, domestic oil and gas producer focused on development of its premier assets in the
Forward-Looking Statements and Cautionary Statements
Certain statements in this press release, including those that express belief, expectation, or intention, are “forward-looking” statements based on assumptions currently believed to be valid. Forward-looking statements are all statements other than statements of historical facts. The words “anticipate,” “believe,” “ensure,” “expect,” “if,” “intend,” “estimate,” “probable,” “project,” “forecasts,” “predict,” “outlook,” “aim,” “will,” “could,” “should,” “would,” “potential,” “may,” “might,” “anticipate,” “likely,” “plan,” “positioned,” “strategy,” and similar expressions or other words of similar meaning, and the negatives thereof, are intended to identify forward-looking statements. Specific forward-looking statements include statements regarding the Company’s plans and expectations with respect to the Offering, including the potential methods of distribution of the securities by the underwriter. The forward-looking statements are intended to be subject to the safe harbor provided by Section 27A of the Securities Act, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995.
The Company cautions investors that any forward-looking statements are subject to known and unknown risks and uncertainties, many of which are outside the Company’s control, and which may cause actual results and future trends to differ materially from those matters expressed in, or implied or projected by, such forward-looking statements, which speak only as of the date they are made. Investors are cautioned not to place undue reliance on these forward-looking statements. Risks and uncertainties that could cause actual results to differ from those described in forward-looking statements include, without limitation, Civitas’ future financial condition, results of operations, strategy and plans; changes in capital markets and the ability of Civitas to finance operations in the manner expected; the effects of commodity prices; the risks of oil and gas activities; and the fact that operating costs and business disruption may be greater than expected.
Additional information concerning other factors that could cause results to differ materially from those described above can be found under Item 1A. “Risk Factors” and “Management’s Discussion and Analysis” sections in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, subsequently filed Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other filings made with the SEC, each of which is on file with the SEC.
All forward-looking statements speak only as of the date they are made and are based on information available at the time they were made. The Company assumes no obligation to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements were made or to reflect the occurrence of unanticipated events except as required by federal securities laws. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance on such statements.
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Civitas Contacts
Investor Relations:
Brad Whitmarsh, 832.736.8909, bwhitmarsh@civiresources.com
Kara English, 303.312.8790 kenglish@civiresources.com
Media:
Rich Coolidge, info@civiresources.com
Source: Civitas Resources, Inc.
FAQ
What is the secondary public offering announced by Civitas Resources?
Will Civitas Resources receive any proceeds from the stock sale?
Who is the underwriter for the Civitas Resources stock offering?
How many additional shares can the underwriter purchase in the Civitas stock offering?
Where will the Civitas Resources shares be offered for sale?
