The Wire

Jul 13, 2022

Apollo launches JV with Fortress Energy on LNG; Secondaries reopens to energy

Happy Wednesday Hubsters!

This is Chris for Wire Wednesday.

We have a few things on the energy transition for you this morning. Speaking of energy topics, I’ve noticed an uptick in interest in energy-related secondary deals, whether that’s LPs selling stakes in energy funds, or processes by which GPs try to extend their holds over energy assets.

“Oil is way up, pricing has recovered a bit, not a ton, so it’s good if you’re trying to sell energy assets. Optically, it’s probably a pretty good value play,” a secondary buyer told me recently. “But, do oil prices stay where they are?”

As well, some traditional secondary buyers likely won’t be touching oil and gas assets due to an increased focus on ESG, the buyer said. “That’s caused a number of people to shy away from being too involved in oil and gas.” What are you seeing? Hit me up at cwitkowsky@buyoutsinsider.com.

Transition: Apollo Global Management recently formed a joint venture with New Fortress Energy to create a platform providing infrastructure for delivery, storage and regasification of liquefied natural gas (LNG).

The JV is underpinned by long-term contracts, benefitting from New Fortress Energy’s LNG downstream operations and development activities as well as Apollo’s investment and maritime experience, writes Obey Martin Manayiti on PE Hub today.

“We believe LNG is a critical enabler for energy transition, decarbonization, energy security and reliability for global economies,” Fierstein told PE Hub. “For us to invest behind the critical assets that facilitate its use, we think it’s an attractive investment opportunity and a key part of our sustainable investing thesis.”

SPONSORED INSIGHT

Critical Pairing: Cybersecurity & Digital Transformation

New research conducted by IDC sponsored by ECI shows 88% of alternative investment firms are increasing DX and security budgets and firms will need outsourced expertise to capitalize on their investment. Are you ready?

Download the white paper

Also of note (may require subscriptions)

Buyouts' latest Off-duty column speaks with Andrew Nikou, who founded OpenGate Capital. Nikou shares his favorite song, his fantasy job as a Montana rancher, and why the adage 'good thoughts, good words, good deeds' provides daily inspiration.

Capitol Meridian, formed by a group of former Carlyle executives, is raising its debut fund for investments in businesses that provide services and products to government customers, according to sources as well as the firm’s Form ADV. (Buyouts)

Inside Cinven’s inaugural financial services fund: The firm gathered €1.5bn for its fund dedicated to the strategy, which will mainly target platform acquisitions in mid-market Europe. (Private Equity International)

L Catterton, the global consumer private equity firm, has launched a private credit unit and hired Shahab Rashid as managing partner and co-head of private credit. (Private Equity International)

Private equity has been the best performing asset class for American pension funds, according to the American Investment Council’s 2022 Public Pension Study. (Buyouts)

"While leveraged buyouts struggle, one corner of private equity just keeps on going — the pursuit of infrastructure assets such as airports, gas pipelines and broadband networks. Combine strong demand for these inflation-proof businesses with rising borrowing costs, and the risk of overpaying for deals is rising." (Bloomberg)

"Private-equity returns in one of [Illinois'] big funds are the best in the nation. But the fund still is $33 billion short." (Crain's)

"Wolf-Henning Scheider was named partner and head of private equity at Partners Group, a spokeswoman said in an email. He will be based in the global private markets manager's headquarters in Baar-Zug, Switzerland, and will succeed David Layton, partner and CEO, as head of private equity." (Pensions & Investments)

"Five lessons from a weak first half for private-equity fundraising: First-half data suggest buyout firms have a long road to travel before fundraising conditions improve." (WSJ Pro)

Private equity has the “ability to deploy capital quickly to make decisive moves in terms of strategy and initiatives for a company without the same restrictions or hurdles as with public companies.” This will make PE key in energy security.

— Brad Fierstein, Apollo partner, talks to PE Hub about the firm’s investments in the energy transition.

Today's letter was prepared by Chris Witkowsky

Subscribe now to get full, unlimited access to all PE Hub content, including every PE Hub Wire article.

Please visit Buyouts for the latest insight into LP activity and Venture Capital Journal for comprehensive coverage and analysis of what’s happening in VC.

London | New York | Hong Kong

PEI Media Group Ltd is registered in England no.6135779

Registered office: 7th Floor, 100 Wood Street, EC2V 7AN

To update your PE Hub email preferences, or to unsubscribe, click here.