Genie Energy Ltd., (GNE) announced its intention to launch an offer to exchange outstanding shares of Class B Common Stock for a new series of Preferred Stock. The offer will cover approximately one-third of the outstanding common stock, and Howard Jonas will not be exchanging any shares of common stock he owns or controls.
The exchange will be on a one for one basis, and the preferred stock will have a liquidation preference currently anticipated to be $8.50 per share, and dividend right that is senior to dividends on the common stock, providing an annual yield in the 7-8% range. Genie anticipates that, following the current quarter, dividends on the common stock will be suspended for an indefinite time. The preferred stock will be redeemable by Genie after a certain period.
Claude Pupkin, Chief Executive Officer of Genie, said “Genie is a unique combination of our retail energy business, which generates good cash flow, even while investing in steady growth, and Genie Oil and Gas, which requires substantial investment, but offers the potential for fantastic future growth and value. In the nine months since the spin-off of Genie from IDT, we have learned that stockholders have varying investment preferences and objectives. The exchange offer will provide our stockholders with the opportunity to own a security meeting their preferences, while allowing us to continue to benefit from the synergies of having the two operations in one corporate family.”
Ira Greenstein, President of Genie, added “Our oil and gas projects are long term plays, with risks both known and unforeseen. We are bullish on the long-term prospects of our GOGAS business, but that risk profile and horizon may not be comfortable for all our stockholders. The exchange offer is intended to ensure that a broader range of investors have the opportunity to partner with Genie and reap the rewards of our performance.”
Recommended Reading
Enbridge Announces $500MM Investment in Gulf Coast Facilities
2024-03-06 - Enbridge’s 2024 budget will go primarily towards crude export and storage, advancing plans that see continued growth in power generated by natural gas.
Williams CEO: Louisiana Energy Gateway Start Temporarily in Limbo
2024-03-21 - Williams CEO Alan Armstrong said the project still moving forward after hitting a snag in a dispute with Energy Transfer but lacks a definitive start date.
Pembina Pipeline Enters Ethane-Supply Agreement, Slow Walks LNG Project
2024-02-26 - Canadian midstream company Pembina Pipeline also said it would hold off on new LNG terminal decision in a fourth quarter earnings call.
Kinder Morgan Sees Need for Another Permian NatGas Pipeline
2024-04-18 - Negative prices, tight capacity and upcoming demand are driving natural gas leaders at Kinder Morgan to think about more takeaway capacity.
Targa Resources Forecasts Rising Profits on 2024 Exports
2024-02-20 - Midstream company Targa Resources reports a record fourth quarter in volumes and NGL fractionation.