LandBridge Co. LLC (LB) shares plummeted 5.50% in pre-market trading on Monday following the announcement of a secondary public offering of Class A shares. The oil-rich Permian Basin landowner priced the underwritten public offering of 2.5 million Class A shares at $71.00 per share, raising approximately $177.5 million.
The offering, initiated by LandBridge Holdings LLC, which is controlled by private equity firm Five Point Energy, represents a 4.7% discount to the stock's last closing price. This move by the private equity sponsor to trim its stake has put significant downward pressure on the stock price. Following the sale, Five Point's holdings will decrease to about 48.6 million Class B shares out of LandBridge's total of approximately 77.1 million shares outstanding.
The secondary offering comes at a time when LandBridge's stock had shown strong performance, rising 40% over the past month and up 15% year-to-date before this announcement. The company, which went public in June 2024 at $17 per share, has seen significant growth since its IPO. However, this secondary offering has raised concerns among investors about potential dilution and the reasons behind the private equity firm's decision to reduce its stake. As the market digests this news, investors will be closely watching how LandBridge's stock performs in the coming trading sessions.
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