“Houston’s energy woes creating a hotbed of activity for private equity, transactional lawyers”
Private equity firms focused on E&P firms raised just over $50 billion last year, and the same stood true in 2013. Those groups have been sitting on mountains of capital. Now, they’re capitalizing on the abundance of cheap assets and opportunities in the energy space.
“You’ve got all these energy-focused funds that have recently raised multibillion-dollars worth of capital and they haven’t deployed it,” said Wes Williams, corporate and securities practice leader at Dallas-based Thompson & Knight.
There’s a slew of Houston-area private equity firms and private equity-backed companies that are active in the energy buying space. Industry-wide, in 2014, private companies and private equity groups accounted for 41 percent of all exploration and production company purchases; experts say the vast majority of that were energy-focused private equity groups, many of which are based in Houston. Williams said that the 41 percent sample is probably representative of how E&P buyers have been distributed in Houston.