Infinity Natural Resources announced that it has agreed to increase its ownership interest in the $1.2 billion Antero Ohio Utica Shale acquisition from 51% to 60%, funded in part by a $350 million strategic equity investment from energy-focused private capital firms Quantum Capital Group and Carnelian Energy Capital Management, L.P.
The investment, structured as Series A convertible preferred stock, is designed to significantly reduce Infinity’s pro forma leverage while enhancing liquidity. The company said the transaction strengthens its financial flexibility as it accelerates the development of its drilling inventory and evaluates further consolidation opportunities across the Appalachian Basin.
Infinity entered into an agreement with Northern Oil and Gas, Inc. to increase its stake in the transformational Antero Ohio acquisition. The company continues to expect the acquisition to close by the end of the first quarter of 2026.
Under the terms of the investment, Quantum will purchase $275 million of preferred stock, and Carnelian will purchase $75 million, totaling $350 million. The preferred shares carry an 8.00% annual dividend, paid quarterly, for the first five years, increasing to 12.00% thereafter. For the first two years, Infinity may elect to pay dividends in cash or in kind, with the latter added to the liquidation preference.
The preferred stock is convertible into Infinity Class A common shares at $21.39 per share, representing a 30% premium to the five-day volume-weighted average price prior to signing. After three years, Infinity may force conversion if its Class A stock trades above 140% of the conversion price for a specified period. After five years, the company may redeem the preferred shares at a price delivering a 15% internal rate of return.
On an as-converted basis, the preferred shares represent approximately 20.5% of Infinity’s voting power and generally vote alongside common stockholders. The securities also include customary minority consent rights and anti-dilution protections.
The private placement is expected to close substantially simultaneously with the Antero Ohio acquisition, subject to customary closing conditions. BofA Securities is serving as sole placement agent for the transaction.
Infinity said proceeds not used to increase its acquisition stake will be used for general corporate purposes, including the repayment of borrowings under its senior secured revolving credit facility.
KEY QUOTES
“Quantum and Carnelian bring deep energy sector expertise and a proven track record of partnering with management teams to drive operational excellence and strategic growth. Their investment further validates our strategic direction while allowing us to increase our participation in the Antero Ohio acquisition and maintain a conservative capital structure. The transaction furthers our financial flexibility to pursue additional accretive growth opportunities. We are excited to have Matt Kelly from Carnelian join the Board at closing.”
Zack Arnold, President and Chief Executive Officer, Infinity Natural Resources, Inc.
“Infinity’s strong operational execution and successful organic drilling program demonstrate management’s ability to create significant stakeholder value in the Appalachian Basin. We are excited to partner with Infinity as a strategic investor and to support its transformational Antero Ohio acquisition and continued growth trajectory.”
Rob Anderson, Managing Director, Quantum Capital Group
“The combination of Infinity’s operational excellence and the strategic scale provided by the Antero Ohio acquisition positions the company as a leading consolidator in one of North America’s premier unconventional basins. This investment aligns with our focus on partnering with best-in-class management teams executing accretive growth strategies.”
Matt Kelly, Managing Director, Carnelian Energy Capital Management, L.P.
