Warren Equity Partners, a middle market private equity firm, has partnered with Multifuels, L.P. to build a midstream pipeline platform. As part of the transaction, Multifuels is contributing an existing natural gas pipeline that supplies a utility service area in Texas, and Warren Equity is contributing approximately $20 million of cash and equity commitments.
Headquartered in Houston, Texas, Multifuels Midstream Group (MMG) will own, operate and develop midstream projects in North America, with an emphasis on lateral distribution pipelines. These laterals will transport natural gas from main lines to end users, such as utilities and petrochemical plants, under long-term contracts that are not exposed to fluctuations in the price of oil and gas.
The company will be led by a seasoned management team that is highly experienced in the development of pipelines, gathering systems and storage assets in the oil and gas industry. Randy Gibbs will be the company’s CEO, and Dick Robinson, Gil Muhl and Jim Ducote will form the remainder of the management team.
MMG will execute on an existing portfolio of development projects which capitalizes on the U.S. trend toward increased utilization of natural gas in power plants, petrochemical plants and industrial complexes; growth in the number of residential households accessing natural gas through local distribution companies; and increased export opportunities through LNG facilities. MMG’s projects are developed under long-term contracts with strong creditworthy counterparts.
“Warren Equity shares our vision for the future of Multifuels, and we are enthusiastic about this next chapter in our organization. We look forward to working with Warren Equity to pursue what we view as a tremendous opportunity in the energy space,” said Multifuels’ CEO, Randy Gibbs.
Steven Wacaster, a Partner at Warren Equity, commented, “We are excited to partner with the Multifuels team. In addition to the operating pipeline asset the Company will own at close, the team has developed a unique set of project opportunities that capitalize on strong trends in this environment with an excellent risk/return profile.”
Warren Equity Partners is a private equity firm that invests in small and middle market operating companies primarily in North America. The firm invests in established companies where additional capital and operating resources can accelerate growth, targeting product and services companies in the industrial, infrastructure, energy and building sectors. Warren Equity invests in the form of buyouts, growth equity, and recapitalizations.