8%+ Dividend Vanguard Natural Resources Is Back To Business As Usual Despite The Price Crash

Vanguard Natural Resources LLC (Nasdaq: VNR) is an energy exploration and production company that acts as a limited partnership for tax purposes. It is essentially an energy LP without any IDRs or GP interest. It tries to generate stable income for its unitholders. Even after recently cutting its distribution from $2.52 per common unit to $1.41 per common unit per year, its "covered" 8.16% distribution (DCR of 1.09x for Q1 2015) says that it is still generating good income for unitholders. Tax-wise, VNR requires a K-1.Prior to the LRR Energy (LRE) acquisition agreement, VNR's properties were located in the Green River Basin in Wyoming, the Arkoma Basin in Arkansas and Oklahoma, the Permian Basin in West Texas and New Mexico, the Big Horn Basin in Wyoming and Montana, the Piceance Basin in Colorado, the Gulf Coast Basin in Texas and Mississippi, the Williston Basin (Bakken) in North Dakota and Montana, the Wind River Basin in Wyoming, and the Powder River Basin in Wyoming. LRE's properties in the Permian Basin, The Mid-Continent, and the Gulf Coast fit nicely into VNR's geographic profile. The LRE acquisition is expected to complete in Q3 2015.VNR is purchasing LRE for an implied purchase price of $8.93 per unit of LRE (or $539 million). The consideration includes the assumption of LRE's net debt of $288 million. This price represents a 13% premium to LRE's closing stock price on April 20, 2015 and a 19% premium to LRE's 10-day volume weighted... Read more