Diamondback Takes Viper Equity Instead Of Cash — Viper Says More Buybacks Could Follow
The election covers all operating-company units held by the reporting entities, with future participation reviewed quarterly.
Diamondback Energy and the other reporting entities elected to reinvest all distributions from their operating-company units in Viper Energy, which owns oil and gas mineral and royalty interests, rather than receive cash. The election was made Thursday and reported in Monday's amended SEC ownership filing; Viper CEO Kaes Van’t Hof said in the company's plan announcement that it could support increased Class A share repurchases.
Cash Becomes Exchangeable Equity
Viper and VNOM Holding Company, its operating company, adopted the plan Thursday. Viper's audit committee and board approved it unanimously.
Eligible operating-company unitholders can reinvest their entire distribution or a chosen percentage. Viper and its wholly owned subsidiaries are excluded from participation.
On each payment date, the reinvested cash becomes a contribution to the operating company. Participants receive additional units priced using the average Class A closing price over the five trading sessions immediately before payment, plus a matching number of Class B shares. Those units and Class B shares can be exchanged together for Class A stock.
Diamondback's Established Viper Holding
Diamondback reported 145,972,177 shares, or 43.1% of Class A stock, under the disclosure's ownership rules, which include securities acquirable within 60 days. Separately, Diamondback E&P reported 10,874,987 shares and 5.3%; Endeavor Energy Resources reported 70,633,640 shares and 26.8%.
Monday's amendment updates an ownership disclosure originally filed on August 26, 2025. Diamondback formed Viper to own and buy oil and natural gas interests, primarily in the Permian Basin.
Viper collects royalties while the working-interest owners leasing nearly all its land pay to develop and operate the wells. At December 31, 2025, Viper held about 96,003 net royalty acres, and Diamondback operated about 35% of that acreage. Viper reported $1.3 billion in royalty income for 2025.
Viper has no employees of its own and operates in one reportable segment; Diamondback supplies management and administrative services. Viper's market value was $7.8 billion at Monday's close.
The election starts with the third-quarter distribution payable November 19. The reporting entities will review their participation each quarter.
Sources
- SCHEDULE 13D/A — Diamondback Energy, Inc. re: Viper Energy, Inc. (VNOM) — SEC EDGAR
- Viper Energy Adopts Distribution Reinvestment Plan; — globenewswire.com
