(Reuters) -Liquefied natural gas exporter Venture Global said on Thursday it had raised $1.75 billion, marking the first big initial public offering of President Donald Trump’s second term as investors bet on his plan to boost U.S. energy production.
Venture Global is the second-largest exporter of liquefied natural gas, or LNG, in the United States, and one of Trump’s first moves after his inauguration was to sign an executive order to end a moratorium on new LNG export permits, which clears an obstacle to Venture Global’s expansion plan.
However, the company was forced to nearly halve the valuation it was seeking after investors balked at its estimates for long-term profit for exports, Reuters reported on Wednesday.
The offering of 70 million shares was sold at $25 each, within a revised range of $23 to $27 apiece. The company also increased the number of shares on offer.
The company had initially set a target of selling 50 million shares for $40 to $46 each to raise as much as $2.3 billion for a valuation of $110 billion.
Trump had promised to maximize U.S. oil and natural gas production in part by clearing away what he deems unnecessary regulation and bureaucracy. Trump has also said he wants to see European companies buy more U.S. LNG.
Venture Global’s offering extends a strong start to the year for IPOs, buoyed by interest rate cuts by the U.S. Federal Reserve and expectations of deregulation and corporate tax reductions under the Trump administration.
Oilfield services provider Flowco’s shares jumped in their market debut last week, while Smithfield Foods is set to go public next week with a valuation aim of $10.7 billion.
Venture Global has five LNG projects in various stages of development near the Gulf of Mexico in Louisiana and expects to have total peak production of 143.8 million tonnes a year.
Developers such as Venture Global have built terminals along the U.S. Gulf Coast to liquefy and ship the gas, turning the United States into the world’s top LNG exporter.
Investors had been concerned by Venture Global facing contract arbitration cases brought by some of the world’s top oil and gas producers, including BP, Shell and Repsol, for cargoes exported from the company’s first project, the Calcasieu Pass plant.
The cases could cost Venture Global billions of dollars if it loses, its IPO document indicated.
Despite the price revision, Venture Global’s market value is on track to surpass rival Cheniere Energy, currently the largest U.S. LNG exporter with a market value of around $52.36 billion.
Venture Global, founded in 2013, will start trading on the New York Stock Exchange on Friday under the ticker symbol “VG.”
The IPO is being underwritten by a syndicate of Wall Street banks led by Goldman Sachs, JPMorgan and BofA Securities.
(Reporting by Pritam Biswas and Chandni Shah in Bengaluru; Editing by Subhranshu Sahu and Raju Gopalakrishnan)
