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Lime Rock Partners, private equity investors of growth capital in E&P and oilfield service companies, has successfully closed a $203 million acquisition fund, Lime Rock Partners VI AF, the company said on Nov. 23.
The fund has acquired assets formerly owned by Lime Rock Partners VI LP, a 2012 vintage fund, and seeks to benefit from further value appreciation in those assets. The acquisition fund, in which the Goldman Sachs Asset Management Vintage Funds served as the lead investor, received $134 million in new capital commitments to it and a separate co-investment vehicle.
"We are thankful to the new acquisition fund investors and rolling investors for their attention and enthusiasm for the options presented to them,” John Reynolds, co-founder and managing director of Lime Rock Partners, said. “With this, our second GP-led secondary, we continue to believe that there are good, market solutions to respond to some investors' preferences for liquidity while allowing others to hold investments beyond a normal fund life."
All Fund VI limited partners had the option of reinvesting their Fund VI exposure into the acquisition fund or receiving accelerated full liquidity.
Interests in CrownRock Minerals vehicles, two entities acquiring mineral and royalty interests in the Permian Basin, represented the vast majority of the assets in the acquisition fund. Inclusive of co-investment vehicles, Lime Rock Partners has invested nearly $1.1 billion in minerals and royalties since 2015.
Since 2007, Lime Rock has partnered with Midland, Texas-based CrownQuest Operating, the management of the CrownRock Minerals vehicles and of CrownRock, an operator in the Midland Basin. In 2018, Lime Rock completed its first acquisition fund, Lime Rock Partners IV AF, a then $1.9 billion fund. Fund IV AF mainly consists of interests in CrownRock, which is still majority owned by that fund.
"In both of these secondary processes, we have sought to align new and rolling investors with the potential value creation we believe is possible by patient acquisition and development of assets in the Midland Basin—both working interest and mineral interests. We are, as always, grateful to the CrownQuest team and their partnership in executing these strategies," J McLane, chief investment officer and managing director, said.
Moelis & Co. served as financial adviser to Fund VI. Morgan, Lewis & Bockius LLP served as legal adviser to the funds and Lime Rock.
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