Viper Energy buys Sitio Royalties for $4.1 billion
Viper Energy is fortifying its position as a major player in the U.S. mineral and royalties market with a $4.1 billion all-stock acquisition of Sitio Royalties, a move that significantly expands its holdings in the Permian Basin and beyond.
Announced on June 3, the deal includes the assumption of $1.1 billion in Sitio’s net debt and values Sitio at $19.41 per share based on Viper’s June 2 closing price. The transaction, which is expected to close in the third quarter of 2025, has received unanimous approval from both companies’ boards, with key shareholder support already secured.
Structure of the Deal
Under the agreement, Sitio Class A shareholders will receive 0.4855 shares of Class A common stock in a new Viper holding company. Holders of Sitio’s operating units will receive an equivalent number of Viper Energy Partners LLC units and associated Class B stock for their Sitio Class C shares.
Diamondback Energy, which owns a controlling stake in Viper and recently transferred its own Permian mineral interests to the company in a $4.45 billion transaction, has approved the Sitio deal via written consent. Once the deal closes, Diamondback is expected to hold about 41% of Viper’s outstanding shares.
A Dominant Position in the Permian and Beyond
Post-merger, the combined entity will own roughly 85,700 net royalty acres, solidifying its status as one of the largest pure-play mineral and royalty companies in the U.S. Sitio brings 25,300 net royalty acres in the Permian and an additional 9,000 acres across the Denver-Julesburg (D-J), Eagle Ford, and Williston basins.
The acquisition also marks a strategic boost in the Delaware Basin, one of the most productive parts of the Permian.
Operational and Financial Advantages
The merger is not just about scale—it’s also about efficiency. Viper expects to realize over $50 million in synergies, largely from reduced general and administrative expenses and a lower cost of capital. The transaction also lowers the company’s pro forma breakeven oil price by $2 per barrel, bringing it below $20/bbl WTI.
In Q1 2025, Sitio reported production of 42,100 barrels of oil equivalent per day (boe/d), including 31,900 boe/d from its Permian assets.
A New Chapter for Mineral Aggregation
Kaes Van’t Hof, CEO of both Viper and Diamondback Energy, hailed the deal as transformative for the mineral and royalty sector.
“The combination of Viper and Sitio signifies an important moment for mineral and royalty interests,” Van’t Hof said. “This combination creates a leader in size, scale, float, liquidity and access to investment grade capital in the highly fragmented minerals industry.”
Sitio CEO Chris Conoscenti echoed that sentiment, emphasizing the complementary nature of the two companies’ portfolios and strategic visions.
“We are excited to announce the combination of two leading minerals companies with a shared strategic vision of integrating the highest quality assets to create a truly differentiated investment opportunity for shareholders,” Conoscenti said.
Industry Implications
This latest consolidation move follows a growing trend in the U.S. oil and gas sector, where companies are prioritizing scale, efficiency, and shareholder returns. For Viper, which has already completed the largest mineral deal in history earlier this year with Diamondback, the Sitio acquisition reaffirms its role as a dominant consolidator in the minerals space.
As the U.S. shale landscape matures, the race to aggregate high-quality mineral interests is intensifying. With Sitio’s assets now under its belt, Viper Energy is firmly positioned at the front of that race.
