Form 4: KKR Sells 13.8 Million Shares of Crescent Energy (CRGY) in Public Offering

KKR Group Partnership L.P. and related entities sold 13.8 million shares of Crescent Energy Co (CRGY) Class A Common Stock at $9.87 per share in an underwritten public offering.

Summary

• KKR Group Partnership L.P. and related entities have filed a Form 4 with the SEC detailing changes in their beneficial ownership of Crescent Energy Co (CRGY) securities.
• On March 11, 2024, IE Aggregator transferred 2,300,000 units of Crescent Energy OpCo LLC to the Issuer and forfeited an equal number of Class B Common Stock, which were then cancelled by the Issuer, in exchange for $9.87 per OpCo LLC Unit.
• Also on March 11, 2024, IE Aggregator converted 13,800,000 shares of Class B Common Stock and OpCo LLC Units into 13,800,000 shares of Class A Common Stock.
• Subsequently, IE Aggregator sold these 13,800,000 shares of Class A Common Stock at $9.87 per share in an underwritten public offering.
• Following these transactions, KKR's indirect ownership includes 48,934,496 Class B Common Stock, 35,134,496 Crescent Energy OpCo LLC Units, and no Class A Common Stock directly held, but 572,354 Class A Common Stock held directly by KKR Upstream Associates LLC.
• The filing includes disclaimers of beneficial ownership except to the extent of pecuniary interest.

Sentiment

Score: 5

Explanation: The document is a factual report of transactions. The sentiment is neutral as it simply describes the sale of shares and related transactions.

Industry Context

This transaction reflects ongoing activity in the energy sector, with financial institutions like KKR adjusting their holdings in companies like Crescent Energy. Public offerings and secondary sales are common mechanisms for large shareholders to realize gains or rebalance their portfolios.

Comparison to Industry Standards

• It is difficult to compare this transaction to industry standards without knowing the specific reasons behind KKR's sale.
• However, large institutional investors like KKR frequently adjust their holdings in publicly traded companies, and secondary offerings are a common way to do so.
• Comparable transactions would include other instances of private equity firms reducing their stakes in energy companies through public offerings or private sales.

Related Party Transactions

• The OpCo Unit Repurchase is a related party transaction involving IE Aggregator, OpCo, and the Issuer.

Stakeholder Impact

• The sale of shares could have a short-term impact on the share price of Crescent Energy.
• The transaction provides liquidity for KKR, a major shareholder.

Key Dates