Haynes Boone Partners Ellen Conley and Kim Mai spoke with Argus Media about the growing use of asset-backed securitization (ABS) in U.S. oil and gas acquisitions, discussing how the financing structure is enabling buyers to submit more competitive bids and becoming increasingly accepted across the industry.
Read an excerpt below.
"A buyer that is financed through a traditional RBL facility may not be able to offer up as high a purchase price as a buyer that is being financed under an ABS structure, because ABS is able to offer a higher advance rate with respect to such assets," law firm Haynes Boone partner Ellen Conley says.
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"Since then, ABS is a lot more of a known product so sellers have accepted it, "Haynes Boone partner Kim Mai says. "If there are assets out there, certainly most of the buyers are at least considering ABS financing as an option."
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