By Sarah Young
LONDON, Sept 24 Energy-focused private equity
firm Riverstone Holdings is to list a new energy vehicle on the
London Stock Exchange in an initial public offering that could
raise up to 1.5 billion pounds ($2.4 billion).
The new company, Riverstone Energy Limited (REL), said on
Tuesday it had already secured 550 million pounds worth of
commitments. It plans to invest in energy companies and assets
worldwide, focusing on exploration and production of oil and
gas, and their storage and transportation.
It has a heavyweight board, counting the former chairman of
FTSE 100 oil and gas firm BG Robert Wilson as its
chairman, and former BP Chief Executive John Browne as a
Wilson said REL would seek to raise up to 1.5 billion pounds
from other institutional investors before the shares are
admitted to London's main market on Oct. 29.
The minimum size of the share sale would be 670 million
pounds, he added.
REL said U.S.-headquartered Riverstone would act as its
investment manager and the two would co-invest on deals.
Europe has seen a pick-up in initial public offerings (IPOs)
this year as market confidence has improved, with London a big
driver of activity. As of Sept. 19, IPOs by British companies
had raised $3.9 bln in 2013, a 201 percent increase on the same
period in 2012.
Should it beat its minimum target size, REL could enter the
FTSE 250 index of Britain's midcap companies, Wilson
The 550 million pounds already committed is comprised of 50
million pounds from Riverstone as well as 500 million pounds
from five so-called cornerstone investors.
Those five investors are a unit of the Alaska Permanent Fund
Corporation; Texas-based Hunt Oil Company; KFI, a private
investment vehicle of Louis Bacon, founder of Moore Capital
Management; Casita LP; and the McNair Group.
REL said the 550 million pounds bought 55 million shares at
10 pounds a share. The number of shares issued in total and the
price would be determined by demand, a spokesman said.
Riverstone has featured in the British press in recent
months because it is a part-owner of Cuadrilla, a company whose
exploration for shale gas in southern England has been the
subject of protests.
REL will aim to invest primarily in privately-owned
companies and also assets, said Wilson, highlighting the
numerous recent disposals by oil majors such as BP and Total
as potential opportunities.
"Some of those assets which may be relatively marginal to a
super major, can actually be good opportunities for businesses
like a Riverstone and REL," he said.
Riverstone, for example, bought U.S. oil firm Apache's Gulf
of Mexico shelf assets for $3.75 billion in July.
Goldman Sachs, JP Morgan Cazenove, Deutsche Bank, Morgan
Stanley are acting as joint bookrunners while Berenberg and
Tudor, Pickering, Holt & Co were co-lead managers.