Private Equity | Capital Markets

Desert Peak, Falcon Minerals Seal Merger Deal; Debut New Company

Share Print Bookmark    |    Wednesday,June 08,2022

Desert Peak Minerals and Falcon Minerals announced the successful completion of their $1.9B merger deal.

As a result, the companies have rebranded as Sitio Royalties Corp. (Nasdaq: STR).

On June 3, 2022, prior to the consummation of the merger, Falcon effected a four-to-one reverse stock split of Falcon’s Class A common stock and Class C common stock and formally rebranded as Sitio Royalties Corp. The Company’s Class A common stock and warrants will initially continue trading on Nasdaq under the ticker symbols “STR” and “STRDW.” In connection with the closing of the merger, the Company entered into a new credit facility with a $300 million borrowing base.

In accordance with the terms of the merger agreement, Desert Peak became a subsidiary of Falcon’s operating partnership. Desert Peak’s equity holders received 61,905,339 shares of the Company’s Class C common stock and a corresponding number of common units representing limited partner interests in OpCo.

Chris Conoscenti, CEO of Sitio, said: “Sitio is guided by its commitments to best-in-class leadership and governance standards, capital discipline and a thoughtful approach to value-maximizing M&A. Sitio’s distinguished profile as a leading consolidator in the minerals and royalties space will only continue to strengthen over time with the execution of our proven strategy, focusing on large-scale accretive acquisitions across diversified operators.”

Noam Lockshin, Chairman of Sitio’s Board of Directors, said: “In line with Kimmeridge’s operating philosophy, Sitio has already adopted a best-in-class governance model that is structured to drive long-term shareholder returns and strong alignment with all its stakeholders. When leadership and directors are incentivized to drive outperformance and to optimize shareholder returns, as they are at Sitio, everyone wins. We believe this is the backbone of any successful public company, and Sitio is leading the way in this space.”

Sitio Senior Leadership Team and Board of Directors

• Sitio will be managed by the legacy Desert Peak management team, led by current Chief Executive Officer, Christopher Conoscenti.

• Noam Lockshin, a Partner at Kimmeridge, Sitio’s largest equity holder, will serve as Chairman of the Board of Directors.

The Board comprises seven members with strong independence, diversity and deep expertise across energy, finance and governance: Noam Lockshin, Morris R. Clark, Christopher L. Conoscenti, Alice E. Gould, Allen W. Li, Claire R. Harvey and Steven R. Jones.

Stock Exchange Listing Transfer

As previously announced, the Company plans to transfer the listing of its Class A common stock and warrants from Nasdaq to the New York Stock Exchange and NYSE American LLC, respectively, on or about June 14, 2022, where the Company’s Class A common stock will retain the same ticker symbol “STR,” and the warrants will trade under the new ticker symbol “STR WS.”

The Company’s Class A common stock and warrants will be delisted from Nasdaq in connection with listing on NYSE and NYSE American LLC.