Find out how Opportune added value by advising Ring Energy on the completion of its acquisition of the assets of privately-held Stronghold Energy II Operating LLC and Stronghold Energy II Royalties LP.

Ring Energy Inc. (“REI”) recently announced the completion of its acquisition (the “Transaction”) of the assets of privately-held Stronghold Energy II Operating LLC and Stronghold Energy II Royalties LP (collectively, “Stronghold”). Stronghold’s operations are located primarily in Crane County, Texas, and focused on the development of approximately 37,000 net acres in the Permian Basin’s Central Basin Platform (“CBP”).

Opportune’s Valuation, Complex Financial Reporting, and Transactional Due Diligence practice areas performed the following functions in connection with REI’s acquisition of Stronghold’s assets and the associated hedge book:

Valuation – Opportune’s Valuation team assisted with purchase price allocation services and the estimation of the fair value of oil and gas properties by reserve category.

Complex Financial Reporting – Opportune’s Complex Financial Reporting team assisted with technical accounting and financial reporting advisory, including the following:

• Prepared a technical accounting memorandum related to the preferred stock issuance and business combination versus asset acquisition considerations.
• Advised on SEC reporting requirements and prepared pro forma financial statements and footnotes.
• Assisted with initial balance sheet recognition and related disclosures.

Transactional Due Diligence – Opportune’s Transactional Due Diligence team assisted with the following:

• Performed a detailed review of the preliminary settlement statement and drafted a response to Stronghold detailing areas where the purchase price should be reduced.
• Opportune will continue to assist Ring with a review of the final settlement statement and underlying support once available to verify the appropriate purchase price adjustment for all revenue and expense activity that occurred during the settlement period.

Our consultants are industry experts with a wealth of knowledge and experience in the technical aspects of all forms of financial transactions involving the energy sector, including the accounting, reporting, and economic structuring of corporate mergers and asset acquisitions, reverse mergers, joint ventures, and structured debt and equity capital financings. We bring value to our clients on the transaction advisory assignments through the execution of each critically important component we are assigned.

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About Ring Energy Inc.

Headquartered in The Woodlands, Texas, Ring Energy Inc. is an oil and gas exploration, development, and production company with current operations focused on the conventional development of its Permian Basin assets in West Texas and New Mexico.

About Stronghold Energy II Operating LLC

Stronghold Energy II Operating LLC is majority owned by Warburg Pincus LLC, a leading growth investor (“Warburg Pincus”). Collectively, Stronghold’s owners now are Ring’s largest stockholder. Ring’s Board of Directors has been expanded from seven to nine directors, including two members proposed by Stronghold.