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Petroleum

Cross Timbers Oil Company Announces Registration Statement for Hugoton Royalty Trust Offering

Strategic Insights

— 1 min read

Cross Timbers Oil Company, a leading energy firm, has filed a registration statement with the Securities and Exchange Commission for the offering of 6,000,000 units of beneficial interest (15%) in its newly formed Hugoton Royalty Trust. The offering is being led by a team of six underwriters, including Goldman Sachs & Co., Lehman Brothers, and Bear, Stearns & Co., Inc. The Company's Chairman and CEO, Bob R. Simpson, has stated that the trust's formation and initial public offering are the first steps in a strategy to distribute trust units to common stockholders and achieve a higher market capitalization rate for the Company's quality assets.

Key Takeaways:

  • Cross Timbers Oil Company has filed a registration statement with the Securities and Exchange Commission for the offering of 6,000,000 units of beneficial interest (15%) in its Hugoton Royalty Trust.
  • The offering is being led by six underwriters, including Goldman Sachs & Co., Lehman Brothers, and Bear, Stearns & Co., Inc.
  • The Company plans to use the proceeds of the offering to reduce its bank debt.
  • The Hugoton Royalty Trust is a newly formed entity established by Cross Timbers Oil Company to distribute trust units to common stockholders.
  • The Company's Chairman and CEO, Bob R. Simpson, has stated that the strategy combines continued growth through acquisition and development with distributions of royalty trust units.
  • The Company has announced its goal of reducing debt to $0.40 per Mcfe by 1999.
  • The Company's properties are concentrated in Texas, Oklahoma, Kansas, New Mexico, Wyoming, and Alaska.

Statistics:

  • 6,000,000 units of beneficial interest (15%) of the Hugoton Royalty Trust will be offered.
  • The Company has set a goal of reducing debt to $0.40 per Mcfe by 1999.
  • The Company's properties are located in six states: Texas, Oklahoma, Kansas, New Mexico, Wyoming, and Alaska.

Sources:

  • Press Release: "Cross Timbers Oil Company Announces Filing of Registration Statement for Hugoton Royalty Trust Offering" (Dec. 7)
  • Cross Timbers Oil Company Web site: www.crosstimbers.com

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