TPL in the WSJ

tpltblogger10 Comments

https://www.wsj.com/business/energy-oil/one-of-the-hottest-stocks-in-the-oil-patch-is-a-defunct-19th-century-railroad-4b10a483

“Just having the proper staff to keep up with the pace that the industry was moving at created a ton of revenue,” he said. 

Texas Pacific also started a water company to supply oil producers.

That created a new revenue stream and enabled drilling in dry areas. More drilling meant Texas Pacific could lease additional property for access roads, pipelines and power lines. It opened rock pits and sold producers caliche, a natural cement used to build the roads.

“It opened up a lot of acreage that I don’t think would have otherwise been developed,” Glover said. 

The article as linked to this fun WSJ story from 1998. https://www.wsj.com/articles/SB88653506413772000?mod=article_inline

10 thoughts on “TPL in the WSJ”

    • I don’t think Murray can exit without a company sale. He personally owns a couple percent and his funds own 20% plus. I think he’s one of his funds’ largest investors. I believe he wrote a long time ago that his goal was to own the last share of tpl and I don’t think he was kidding.
      If there were a company sale, he owns enough that he’d likely get to roll his proceeds – in fact he/horizon could be the equity in an lbo…which would be a bummer for us.

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    • FYI Horizon Kinetics is the largest Stockholder in Texas Pacific Land 16.1% and LandBridge 29.8%. according to Simply WallSt.

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      • An interesting revelation included in the last sentence of this paragraph in LandBridge latest press release.

        The acquisitions have been or are expected to be funded with a mix of equity and debt financing, including proceeds from LandBridge’s recently-announced private placement of 5.8 million Class A shares, resulting in an estimated pro forma LQA net leverage1, 2 of 2.7x, with an estimated $113 million in pro forma liquidity. Following the closing of the private placement, LandBridge’s management team and financial sponsor, Five Point Energy, will own an approximate 70% ownership interest in LandBridge.”

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        • Five Point only offered 20% of the company in the IPO. Aka they still owned the other 80% privately. The private placement is them selling a further stake.

          While I was clearly wrong to do so, this is why I didn’t buy LB at IPO. The dilution risk is huge, but apparently the stock doesn’t care about that!

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        • There is no dilution risk in the sponsor selling down their stake. Per share earnings and FCF remains the same. Their is sponsor overhang risk, but the sponsor will want to IPO WaterBridge next year, so they should be smart about the sell down of LandBridge.

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