Energy Capital Partners Raises $805 Million for Mezzanine Fund
Feb 21, 2013
ENERGY CAPITAL PARTNERS RAISES $805 MILLION FOR MEZZANINE FUND
SHORT HILLS, New Jersey – February 21, 2013 – Energy Capital today announced the final close of Energy Capital Partners Mezzanine Opportunities Fund, LP at $805 million in total commitments, which significantly exceeds the $500 million target. The Fund, which already has made two investments, was formed in response to the strong flow of attractive debt and preferred equity opportunities seen in the normal course of deal screening for the firm’s private equity vehicles. These opportunities often require flexible junior capital but fit a risk-adjusted return profile that Energy Capital believes is more appropriate for a mezzanine funding solution than a typical equity investment by the firm’s private equity funds.
“This is an important milestone in Energy Capital’s history that broadens our role as a leading capital solutions provider to the energy industry by responding to a market opportunity to offer flexible funding alternatives via the mezzanine fund,” said Doug Kimmelman, Senior Partner at Energy Capital Partners. “The macro environment, our strong origination network and our existing footprint across many energy industry subsectors continue to present a large number of attractive investment opportunities for the firm. We are grateful for the strong interest and support of our existing private equity investors and for the addition of several new investors and will continue to focus on delivering solid investment performance across all our funds.”
Nazar Massouh, Energy Capital’s Principal leading the firm’s mezzanine investment activities, commented, “The enormous and accelerating capital needs of the energy industry are facing constrained capital availability from traditional sources caused by broad macroeconomic factors and the exit of European project finance banks and other lenders from the North American energy marketplace. This phenomenon is particularly true for middle market companies. Potential borrowers have shown a strong interest in our mezzanine funding solutions and we look forward to deploying this capital in a diversified portfolio of energy investments that meet our return criteria.”
The Fund is targeting investments in debt and preferred equity across the entire energy value chain with a particular focus on fossil and renewable power generation, electric transmission, midstream oil and gas, energy efficiency and conservation, environmental and energy services.
The Fund has made two senior secured loans to date, including the recapitalization of Chieftain Sand and Proppant LLC, a frac sand producer, and the project financing of a subsidiary of Sungevity, Inc, a distributed generation solar provider to the residential sector.
Kirkland & Ellis LLP served as fund counsel and Park Hill Group LLC acted as placement agent.
About Energy Capital Partners
Energy Capital Partners is a private equity firm with over $8 billion in capital commitments. The firm is focused on investing in the power generation, electric transmission, midstream oil and gas, renewable energy, oil field services and environmental services sectors of North America’s energy infrastructure. Its management has substantial experience leading successful energy companies and energy infrastructure investments. For more information, visit
Energy Capital Partners