Natgas Producer BKV Valued at $1.56 Billion in NYSE Debut, Reports Reuters

By Vedant Vinayak Vichare and Pritam Biswas

Shares of BKV experienced a 3.1% increase during their debut on the New York Stock Exchange, resulting in a market capitalization of $1.56 billion for the U.S. producer.

The commencement of the U.S. Federal Reserve’s anticipated interest rate-cutting cycle has created opportunities for companies considering public listings. Some firms are hastening their plans to mitigate uncertainties related to the upcoming presidential elections in November.

"Companies that believe they are indifferent to the election outcome will likely feel more confident about going public now. Bankers are definitely encouraging their clients to explore the market, especially with the S&P at record highs," remarked Phil Haslett, co-founder of EquityZen.

BKV’s shares began trading at $18.55, slightly above the initial public offering price of $18. The company raised $270 million by selling 15 million shares at the IPO price, which was below the previously targeted range of $19 to $21.

U.S. natural gas producers are planning to reduce production in the latter half of 2024, as gas prices have plummeted to multi-year lows. BKV has faced significant challenges due to disappointing prices over the last two years, exacerbated by oil companies increasing gas supplies as a byproduct, leading to negative pricing in regions like west Texas, Arizona, and California.

Last year, BKV secured funding commitments from its Thai parent company, Banpu Plc, to fulfill its financial obligations through June 30, 2025, after failing to meet some lender conditions.

The company initially filed for an IPO in 2022 but had to postpone its plans due to the sharp decline in gas prices.

Post-offering, Banpu will hold approximately a 75.9% stake in BKV.

In addition to BKV, healthcare firm Guardian Pharmacy also debuted on the NYSE on the same day, with weight-loss drug developer BioAge Labs scheduled to go public later that day.