EQV Ventures Acquisition, Presidio enter business combination agreement

Presidio Investment Holdings and EQV Ventures (EQV) Acquisition Corp. entered into a definitive business combination agreement. 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 $660 million, including assets acquired pursuant to the transaction. The combined company, a US-domiciled C Corp to be named Presidio Production 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. 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. 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, 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