SandRidge launches IPO

SandRidge Mississippian Trust I, formed by SandRidge Energy Inc. (NYSE: SD), has launched an initial public offering (IPO) of 12.5 million common units, representing an approximately 45% beneficial interest in the trust, including 1.875 million common units that may be purchased at the option of the underwriters.

The common units being offered have been approved for listing on the NYSE under the symbol SDT.

SandRidge Energy will own 8.5 million common units and 7 million subordinated units in the trust, and assuming no exercise of the underwriters’ option, the trust will have a total of 28 million units outstanding.

The trust will own royalty interests from SandRidge which will entitle the trust to a percentage of the proceeds received by SandRidge from current and future production on its 42,600 net acres in the Mississippian formation.

The acreage SandRidge assigned to the Trust represents less than 5% of the company’s approximately 880,000 net acres in the Mississippian horizontal play.

In addition to the valuation provided by the Trust offering, bids are due April 7th on a sizeable offering of acreage and producing properties also in the Mississippian horizontal play.

Raymond James & Associates Inc. and Morgan Stanley & Co. Inc. will serve as joint book-running managers. Wells Fargo Securities and RBC Capital Markets Corp. will be lead managers, and Oppenheimer & Co. Inc., Madison Williams & Co. LLC, Morgan Keenan & Co. Inc., Robert W. Baird & Co. and Wunderlich Securities Inc. will serve as co-managers. 

Source:  Global Hunter Securities, SandRidge Energy

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