The transaction also includes: a right to purchase an incremental 7.5 percent revenue interest, which would bring Carlyle’s total revenue interest to 55 percent; 7.5 percent of the carried interest in all future funds; and options to acquire BNRI’s 40 percent interest in the carried interest in NGP’s current flagship fund (NGP Natural Resources X, L.P.) and all future NGP funds. Carlyle has also agreed to pay the sellers additional consideration during 2015 to 2018, contingent upon NGP achieving certain business performance goals.
Carlyle Co-CEO and Chief Investment Officer William E. Conway, Jr. said, “Carlyle is systematically strengthening our global natural resources investing platform and NGP is an important part of this effort. NGP’s investing excellence in the U.S. oil & gas, midstream and oilfield services sector, coupled with our established capabilities in commodities, power generation, mezzanine financing and most recently, refineries, allows us to take full advantage of the energy revolution sweeping America. This partnership enables our respective investors to pursue opportunities across the energy spectrum.”
NGP Chief Executive Officer and Co-Founder Kenneth Hersh said, “Our strategic partnership with Carlyle enhances our ability to serve current and future investors. Our current NGP investors will continue to be served tirelessly by NGP’s extensive energy expertise, but they will now also benefit from Carlyle’s global reach, knowledge of debt financing and capital markets, and its extensive network, which complements our own.”
Mr. Hersh continued, “This relationship has tremendous long term benefits. With this transaction, we have facilitated the sale of Barclays’ minority interest in our firm to a strategic partner, and carefully structured the contingent future payouts to favor NGP’s next generation of leaders, thereby providing substantial incentives for everyone to achieve high levels of performance over very long periods of time. Importantly, we did this all without disrupting in any way our current operations or governance structure.”
Carlyle Chairman and Co-Founder Daniel A. D’Aniello, said, “NGP has a proven team, a strong 24-year track record of performance across cycles and is a great cultural match. Our respective teams complement each other in so many ways, positioning both NGP and Carlyle to deliver even better outcomes for our investors.”
Established in 1988 by Ken Hersh and his partners, NGP Energy Capital Management has successfully completed 220 transactions, resulting in cumulative invested capital of $6.6 billion with total enterprise value of $36.1 billion across a range of energy and natural resource assets, including oil & gas resources, oilfield services, pipelines and processing. Other investment mandates include: food, agriculture, water resources and services, energy efficiency, power tech and alternative energy. The firm’s 70 professionals in five offices manage $12.1 billion across eight funds.
NGP will serve as the cornerstone of Carlyle’s growing natural resources investing platform, which includes energy mezzanine financing, energy infrastructure & power generation (Cogentrix), and commodities (Vermillion).
Among many others, certain of NGP’s current and recent former investments in companies that are now publicly-traded include Energy Transfer Equity, Energy Transfer Partners, Eagle Rock Energy, Memorial Production Partners and Resolute Energy Corporation.
Carlyle will host a conference call with the investor community today, December 20, 2012, at 10:00 a.m. EST to discuss the NGP transaction. Immediately following the prepared remarks, there will be a Question and Answer session for analysts and investors. Presentation materials will be available on the investor relations section of The Carlyle Group web site at ir.carlyle.com prior to the call.
Analysts and institutional investors may listen to the call by dialing +1-800-850-2903 (international +1-253-237-1169) and mentioning “The Carlyle Group Conference Call”. The conference call will be webcast simultaneously to the public through a link on the investor relations section of The Carlyle Group web site at ir.carlyle.com. An archived replay of the webcast also will be available shortly after the live event.
This release does not constitute an offer for any Carlyle or NGP fund.