Presidio Petroleum to go Public via Business Combination
Presidio expects to initiate a $1.35/share annual common dividend (13.5% expected dividend yield at $10.00/share) after closing.
Presidio Investment Holdings, LLC (“PIH”), a differentiated oil and gas operator focused on the optimization of mature, producing oil and natural gas assets in the United States, and EQV Ventures Acquisition Corp. (NYSE: EQV) ("EQV"), a special purpose acquisition company sponsored by EQV Group, an experienced acquirer and producer of oil and gas, announced today that they have entered into a definitive business combination agreement (the “proposed business combination”). The proposed business combination will result in Presidio becoming a publicly listed company with an expected listing on the New York Stock Exchange under the ticker “FTW,” reflecting Presidio's roots in Fort Worth, Texas, where it is headquartered. The combined company is expected to have an estimated post-transaction enterprise value of approximately $660iv million, including assets acquired pursuant to the transaction.
The combined company, a US-domiciled C Corp to be named Presidio Production Company ("Presidio" or the “Company”), will be led by Presidio's existing management team, including Will Ulrich and Chris Hammack as Co-CEOs. As part of the transaction, Presidio will also acquire a complementary Texas Panhandle asset from an affiliate of EQV, EQV Resources LLC (“EQV Resources”). EQV’s sponsor will maintain a significant ownership stake in Presidio post-closing.
The transaction will create a new public company with a stable dividend,v underpinned by cash flow from the commodity price hedged production of stable, mature oil and gas wells. Presidio has a strong track record of substantial acquisitions and intends to acquire and optimize additional producing oil and gas wells. Presidio will optimize these acquisitions through the application of technology, which includes automation, real-time data analytics and the introduction of AI processes.
Presidio's entry into the public markets comes at a pivotal moment in the energy sector, as the capital-intensive shale era gives way to a more disciplined focus on returns. Presidio’s differentiated model stands out with zero reliance on future drilling, minimal capital investment, and substantial free cash flow.
Presidio's strategy of acquiring under-managed oil and gas wells offers a contrarian and validated approach to hydrocarbon asset management with a focus on acquiring new assets, and optimizing existing production assets, across the United States.
Presidio Management Commentary
"Presidio was purpose-built to be the last, best steward of America's oil and gas wells," said Will Ulrich, Co-Founder and Co-CEO of Presidio. "This transaction provides a permanent platform to scale our yield-focused model, pursue highly accretive acquisitions, and generate value for shareholders."
"Presidio represents the next evolution of the public oil and gas company — efficient, predictable, and yield-driven within a simple and transparent business model," said Chris Hammack, Co-Founder and Co-CEO. "We believe our track-record of acquisitions and meaningful cost optimization make us the strongest near-term consolidator of mature assets."
“America’s oilfield needs capital-disciplined operators focused on deploying new technology to create long-term value,” continued Will Ulrich. “We have the expertise, track record and capital discipline to squeeze efficiency from every molecule and barrel, delivering superior returns.”
Pro Forma Presidio Production Company Highlights
New public company which deploys technology to efficiently acquire, optimize and produce oil and gas from stable, mature oil and gas wells in the United States
Presidio’s experienced management team staying in place and rolling approximately $40 million of equity
Over 2,000 operated producing wells across Texas, Oklahoma and Kansas with expected net production of 26 Mboe/d in 2025
Low production decline rate of 8% versus 24% peer average
Minimal capital expenditure requirements with only 3% of expected cash flow reinvested
78% of estimated production hedged through 2027
Expected $1.35/share annual common dividend,vi implying a peer-leading 13.5% dividend yield supported by stable hedged cash flows from Presidio’s low-decline producing asset base
Strong capital support with investment from Presidio management, funds advised by JPMorgan Investment Management, Citizens Bank, N.A. and several institutional investors, including a major oil and gas company
EQV Management Commentary
Jerry Silvey, Founder and CEO of EQV, commented, "This transaction with Presidio aligns with our vision to bring a world-class dividend yield focused producing energy company to the public markets. The structure of the transaction and meaningful commitments from investors will be critical to support the tested and experienced management team at Presidio. With our complementary expertise and shared vision, we are confident that Presidio will be a sustainable yield leader, well-positioned to be a preferred consolidator of producing oil and gas assets."
Transaction Details
Upon the closing of the business combination, EQV will be renamed Presidio Production Company and is expected to trade on the New York Stock Exchange under the ticker "FTW". The transaction values Presidio at a pro forma enterprise value of approximately $660 million,vii representing a discount to combined proved developed PV-10 value.
To finance the transaction, EQV has entered into agreements for approximately $85 million in common stock PIPE investments. The common stock PIPE is anchored by strategic and institutional investors, including a major oil and gas company. In addition, management and funds managed by Morgan Stanley Energy Partners will provide approximately $65 million of rollover equity. In connection with the transaction, EQV has also entered into agreements with Presidio and investors to issue, on a private placement basis, approximately $125 million of Perpetual Preferred Stock anchored by funds advised by JPMorgan Investment Management. Presidio has entered into a $50 million reserve-based lending commitment provided by Citizens Bank, N.A. to be funded upon closing. The combined financing, together with approximately $360 million of cash from the EQV trust account,viii will provide substantial liquidity for Presidio to pursue dividend accretive acquisitions.
Presidio's management team and EQV’s sponsor and its affiliates have committed to customary lock-ups. EQV’s sponsor has committed to customary earn-out provisions, which includes subjecting 75% of the founder shares held by EQV’s sponsor after closing into a dividend reinvestment plan and earn-out structure. Presidio’s management team have signed rollover agreements totaling over $32 million, with additional rollover agreements from other interest holders being sought up to an aggregate total of $40 million.
The expected transaction proceeds will be used for a $135 million equity buyout of existing Presidio equity holders, repayment of debt, hedge restriking, transaction expenses, and general corporate purposes. The transaction was unanimously approved by the EQV and Presidio boards of directors and the sole member of EQV Resources, and remains subject to the approval of EQV shareholders and the satisfaction or waiver of customary closing conditions. The balance of cash held in the EQV trust account, the equity private placement financing proceeds and debt financing will allow Presidio to continue to employ its acquisition growth strategy.ix
Advisors
Cantor Fitzgerald & Co served as financial advisor to Presidio and placement agent on the Series A Preferred Equity offering. TD Cowen served as financial advisor and lead capital markets advisor to EQV and as placement agent on the PIPE investment. BTIG, LLC also served as capital markets advisor to EQV. Citizens Bank, N.A. served as debt structuring advisor to Presidio. Sidley Austin LLP acted as legal counsel to Presidio, Kirkland & Ellis LLP acted as legal counsel to EQV, Baker Botts L.L.P. acted as legal counsel to EQV Resources, and Vinson & Elkins L.L.P. acted as legal counsel to TD Cowen. Weil, Gotshal & Manges LLP served as legal counsel to Presidio Management. King & Spalding LLP served as legal counsel to Cantor Fitzgerald & Co.
About Presidio Petroleum
Headquartered in Fort Worth, TX, Presidio is a leading operator of mature oil and gas wells across the Mid-Continent. The company is focused exclusively on optimizing existing production and generating sustainable cash flow from low-decline, producing assets.
About EQV Ventures Acquisition Corp.
EQV Ventures Acquisition Corp. is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities. EQV’s sponsor is an affiliate of EQV Group, which was formed in 2022 and is an active acquirer of producing reserves, completing 14 acquisitions and currently managing and operating more than 1,800 wells across 10 states.