Lucid II, which exists under the larger umbrella of Lucid Energy Group, has been around for about three years and is a large concern within the vicinity of the northern Delaware basin, as it is singularly responsible for expanding the region’s gas producing capabilities by nearly 800%. With accumulated assets, such as approximately 2000 miles of natural gas-collecting pipeline, the acquisition of Lucid II represents a strong business move for the beneficiaries of such a deal, in this case: Riverstone Holding LLC and Goldman Sachs Group Inc.
Riverstone Holdings LLC is the company led by David Leuschen and Pierre Lapeyre that oversees Riverstone Global Energy and Power Fund VI, L.P., while the merchant banking division of Goldman Sachs Group Inc. is responsible for overseeing two germane investment ventures, specifically, West Street Capital Partners VII, L.P. and Global Infrastructure Partners III, L.P. These specific energy-centric funds constitute the major beneficiaries of Lucid Energy Group’s decision, made in tandem with the company’s fiscal supporter, Encap Flatrock Midstream, to sell Lucid II, along with its far from minimal assets, for 1.6 billion.
Debt financing is to be provided for by Jeffries LLC. and the deal should be finalized in 2018. Lucid II which will operate henceforth as a portfolio company under Riverstone and Sachs, will keep its name. Lucid II management team members can expect to retain their positions.
Lucid president and CEO, Mike Latchem, remains justifiably proud of Lucid II’s accomplishments under its parent company, including the 2015 acquisition of the Agave Energy Company, a transaction in which Encap Flatrock Midstream proved to be “instrumental,” according to Latchem. Latchem is confident that the steady, yet speedy growth, already established in the region by Lucid II, under Lucid Energy Group, can be both matched and maintained by the new team of Riverstone and Sachs.
Representatives of Riverstone and Sachs are also happy to be a part of what a Riverstone Holdings representative refers to as Lucid II”s next phase of growth. Riverstone representatives believe the company brings specific and useful goodies to the table of this next phase, such as first-hand knowledge of the region, allied with longtime experience with energy-centric investing. Speakers for Sachs applaud Lucid’s strides in the Delaware region too, crediting Latchem and the Lucid II management team with developing a stellar infrastructure platform, backed by ” strong customer relations with the highest quality producers” in the region. Both companies seem certain that everything is in place for significant growth in the coming years.