04:35 PM EST, 12/09/2024 (MT Newswires) -- Freehold Royalties ( FRHLF ) after close of trading Monday said it entered into a definitive agreement with a private seller to acquire mineral title and royalty interests in the core of the Midland Basin in Texas for approximately $216 million..

The property features 1,250 to 1,350 barrels of oil equivalent per day of premium priced, light oil weighted production; it estimated 2025 royalty revenue at $31 million with 16 rigs currently active on the property.

Freehold will fund the acquisition, which is expected to close Dec. 13, through a $125.1 million bought deal share offering and Freehold's existing credit facilities. It is selling an underwriting syndicate 9.62-million shares priced at $13.00 each, as well as a 15% over-allotment option.

"This transaction expands our footprint, right in the heart of the Midland Basin under ExxonMobil and Diamondback, two operators who recently completed a combined US$90 billion of acquisitions to increase their stakes in this extensive resource play" said chief executive David Spyker. "This type of accretive deal with land and inventory depth, provides both growth and value to the company and our shareholders immediately and is expected to for years to come."

The company's shares closed up $0.01 to $13.65 on the Toronto Stock Exchange.