*

Venture Global ( VG ) raises $1.75 bln in U.S. IPO

*

IPO priced at $25 per share vs $23 to $27 marketed range

*

Third-largest U.S. energy listing since 1995

By Manya Saini and Niket Nishant

Jan 24 (Reuters) -

Venture Global LNG will debut on public markets on

Friday after

sharply lowering its

IPO valuation to $60.5 billion, but still set to be one of

the largest U.S.-listed energy companies.

The LNG exporter cut its valuation by 40% from $110

billion after investors and analysts termed it

'lofty'

, on doubts over its estimated long-term profit from

liquefying gas for export and ongoing legal battles.

It sold 70 million shares to raise $1.75 billion on

Thursday, selling the stock at $25 compared to its offer price

of $23 to $27. This was a far cry from its initial plan to raise

as much as $2.3 billion by selling at $40 to $46.

The market debut will serve as the first big test for energy

companies under an administration led by President Donald Trump,

who has prioritized increasing U.S. energy output and rolling

back his predecessor's climate policies.

"A less talked about issue of the deal is the extremely low

float... which is highly unusual and presents a significant risk

factor due to overhang down the road," said Josef Schuster, CEO

of IPO-focused investment indexes, IPOX.

Venture Global ( VG ) began generating revenue in 2022 when its

first facility, Calcasieu Pass, started producing superchilled

gas.

But it is yet to be commissioned due to contract disputes

with customers such as BP, Shell and Edison

over non-receipt of cargoes due to lengthy testing and

optimizing process before commercial operation.

Venture Global ( VG ) has said since the Calcasieu facility was

still in the commissioning phase, the company is not yet obliged

to fulfill the long-term contracts.

"Venture operates in a complex business that might appeal to

a smaller subset of investors than some large IPOs," said

Nicholas Einhorn, director of research at IPO-focused

Renaissance Capital.

Global LNG demand has risen in recent years amid a shift

toward cleaner energy, with the U.S. emerging as a major

supplier to both European and Asian countries.

After his inauguration earlier this week, Trump issued

an order to resume processing export permit applications for new

LNG projects.

"We will drill baby, drill,"

he said, outlining a plan

to maximize U.S. oil and gas production by declaring a

national energy emergency, removing excessive regulations and

withdrawing the U.S. from a global climate change agreement.

A reduced IPO valuation of $60.5 billion still puts Venture

Global ( VG ) in the league of top U.S. energy companies, dwarfing

high-profile names such as Occidental Petroleum ( OXY ),

Marathon Petroleum ( MPC ), and Schlumberger ( SLB ).

The company's stock will trade on the New York Stock

Exchange.

LARGEST LNG IPO IN HISTORY

Venture Global's ( VG ) share sale marks the biggest IPO ever by an

LNG company globally, according to Dealogic data. It is the

third-largest energy and utility sector listing in the U.S.

since 1995.

"The high market cap reflects the company's ambitious

development plans," Einhorn of Renaissance Capital said. "The

company will definitely need to raise more capital over time,

both equity and debt, to finance its growth plans."

If the stock does well at debut, it will handily surpass

rival Cheniere Energy, the world's largest LNG exporter

that commands a valuation of $52.4 billion on the NYSE.

In addition to Cheniere, Venture Global ( VG ) competes with

Freeport LNG, TotalEnergies, Chevron, ExxonMobil, Petronas,

among others for a share of the lucrative market.

Rising commodity prices and optimism for pro-energy sector

policies under the new Republican administration are also

expected to drive a recovery in energy sector IPOs in 2025. The

capital-intensive sector was among the slowest in U.S. IPO

activity last year.

There were only six energy sector IPOs in 2024, raising

nearly $800 million-a small fraction of the broader market where

150 companies collectively raised $29.6 billion, according to

data from Renaissance Capital.

"For energy and LNG companies, as we are seeing with Venture

Global ( VG ), achieving those very high premiums at IPO is proving

more challenging, particularly when measured against established

public market peers," said Schuster of IPOX.