A private oil and gas company backed by Energy Founders Fund LP (EFF) closed a bridge loan last month used to buy non-operated assets.
EFF is the private-equity fund of Houston-based Donovan Ventures LLC that focuses on providing early-stage growth capital to energy companies seeking less than $5 million.
The bridge loan, for $7 million, closed on April 30 from Production Lending LLC, a Houston-based specialty finance capital provider catering to small oil and gas companies.
A May 31 release said that proceeds from the bridge loan were used by the EFF-backed company to purchase non-operated oil and gas interests in the western U.S.
John Donovan, the founder of Donovan Ventures, noted the timing of the deal.
“We are excited to partner with an experienced management team that successfully procured an attractive producing asset,” Donovan said in a statement. “Given the short timeframe to close, we would not have closed this deal without Production Lending. Production Lending is a wonderful partner and we look forward to working with them in the future.”
Production Lending is owned and run by two former energy bankers, Abhishek Kumar and Ryan Childs, who have underwritten financing transactions worth more than $60 billion over their careers. Their business specializes in providing growth and acquisition financing in the form of short-term bridge capital and longer tenor debt and preferred equity investments throughout the Lower 48.
Since August 2016, Production Lending has funded 14 different transactions for a total capital commitment of more than $30 million, according to the company press release.
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