EXCO currently expects that a registration statement for the initial public offering will be filed in the third quarter of 2007 and that the offering will close during the first quarter of 2008. Approximately $1.5 billion of the MLP's common units are expected to be offered to the public, subject to market conditions. EXCO will own the general partner of the MLP and expects to retain a substantial portion of the MLP's common units. The common units retained by EXCO will have terms identical to those offered to the public.
The purpose of the MLP offering is to provide EXCO with the opportunity to enhance the valuation of a substantial portion of its mature producing properties by contributing these assets to a tax-efficient vehicle that can subsequently pursue the acquisition of additional mature producing properties, either from EXCO or from third parties. The MLP intends to use the proceeds from its initial public offering to retire debt associated with the contributed assets and to provide working capital.
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