Alliance Resource Partners to Buy AllDale Minerals Interests in $206 Million Mixed Deal
The acquisition nearly doubles ARLP's net royalty acreage in the Permian Basin and adds a foothold in the Haynesville shale.
Alliance Resource Partners, L.P. (ARLP) agreed to acquire certain general partner and limited partner interests in AllDale Minerals III, LP and AllDale Minerals IV, LP for approximately $206.2 million in a mixed cash-and-debt transaction, the company said.
The deal values AllDale III & IV at an aggregate gross valuation of roughly $410.0 million. The interests being sold by third-party holders carry a value of about $306.2 million, with ARLP acquiring $206.2 million of that total and related parties of Chairman, President and Chief Executive Officer Joseph W. Craft III purchasing the remaining $100.0 million. The agreements carry an effective date of April 1, 2026, and are expected to close during July 2026, subject to customary conditions. Given Mr. Craft's participation, the conflicts committee of the board of ARLP's general partner — comprised entirely of independent directors — approved the transaction terms.
Upon closing, ARLP's aggregate economic interest across AllDale III & IV is expected to increase from approximately 5% to 61%, and the partnership, through a wholly owned subsidiary, is expected to own 100% of the general partner interests, which will be non-economic post-closing. The acquisition implies an entry multiple of roughly 5.0 times projected next-twelve-month Adjusted EBITDA based on commodity strip pricing as of June 5, 2026, inclusive of existing hedges to be assumed at closing. ARLP expects the deal to be immediately accretive to free cash flow per unit.
"This acquisition accelerates the continued growth of our Oil & Gas Royalties segment," Mr. Craft said. "The AllDale III & IV portfolio adds scale and development upside across multiple U.S. basins, anchored by a meaningful Permian position. It also expands our natural gas footprint with entry into the Haynesville, a resource play well-positioned to benefit from long-term LNG export demand growth".
AllDale III & IV hold approximately 48,500 net royalty acres across the Permian, Anadarko, Bakken, and Haynesville basins. The Permian position accounts for roughly 7,300 of those acres and generated 52% of first-quarter 2026 total royalty revenue. Average first-quarter production stood at about 5,940 barrels of oil equivalent per day in total, with roughly 67% of royalty revenue derived from oil. The acquisition meaningfully enhances ARLP's northern Delaware, Anadarko, and Bakken positions, increasing trailing-twelve-month new wells placed on production by 59%, 78%, and 91%, respectively.
The deal lands amid a broader consolidation cycle in the U.S. minerals-and-royalties space. Kimbell Royalty Partners (KRP) closed a $145.9 million acquisition of Permian Basin mineral and royalty interests from Mesa Royalties in June 2026, funded with a mix of cash and newly issued operating-company units. Texas Pacific Land Corporation (TPL) paid $286 million in cash for roughly 7,490 net royalty acres concentrated in the Midland Basin in late 2024. Both transactions underscore sustained appetite for Permian-weighted royalty assets.
ARLP plans to fund its portion of the purchase through cash on hand, borrowings under its revolving credit facility, and a new debt facility at Alliance Minerals, LLC, a wholly owned subsidiary. Pro forma total leverage is expected to remain below 1.0 times following closing. Upon completion, ARLP's Oil & Gas Royalties segment is projected to control approximately 115,680 net royalty acres, including more than 44,770 in the Permian, with average first-quarter production of roughly 17,295 BOE per day in total and exposure to 59 gross active rigs across the combined portfolio.