Mon, Mar 30, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Private Equity Strategies

Sector View: Energy Focused Tailwater Capital Spins Out of HM Capital

Monday, May 20, 2013

By: Bailey McCann, Private Equity Strategies

Dallas-based, Tailwater Capital has successfully launched, and raised its first fund - Tailwater 1. Tailwater partnered with Landmark Partners to complete the secondary purchase of HM Capital's legacy energy portfolio, and is making investments that follow with HM Capital's approach. Tailwater principals Jason Downie and Edward Herring, have been a team for over 14 years, including work with HM Capital, and were involved with the legacy investments that are part of Tailwater 1.

Going forward, Tailwater will focus on investing in the energy industry with a primary focus on investments within the midstream and upstream sectors. The portfolio includes BlackBrush Oil & Gas, TexStar Midstream Services and SunTerra Well Services. During their tenure with HM Capital, Downie and Herring were responsible for the sourcing of these investments as well as the oversight of each company's performance through representation on each company's board. Both men spoke with Private Equity Strategies about the launch of their firm and new fund.

"We feel like US infrastructure and capital spend to get hydrocarbons to the market will continue to have an opportunity for returns over the next several years," Downie said. "We think it is a great time to be invested in oil and gas."

"We were part of the HM Capital team for 14 years, so we are very familiar with Landmark Partners as an LP, they have been involved since day one, and this is very much an extension of what we were already doing together," Herring explains. Herring and Downie have worked with Landmark Partners on investments in this space since the early 2000s, predating involvement with these portfolio companies.

Tailwater and HM Capital were represented by a team from Weil, Gotshal & Manges LLP led by partner Rodney Moore and Landmark Partners was represented by a team from Kirkland & Ellis LLP led by partner Michael Belsley.

"With Tailwater 1 we are bringing new capital to these investments, and are already almost 80% invested in our portfolio companies," Downie explains. "We are looking at a Tailwater 2 fund for calendar year 2014."

Investments will be focused on oil and gas companies in the US and Canada with an average bite size of $50-100m. As a team, the managing partners have invested over $1bn in equity capital, in the sector.

 
This article was published in Opalesque's Private Equity Strategies our monthly research update on the global private equity landscape including all sectors and market caps.
Private Equity Strategies
Private Equity Strategies
Private Equity Strategies
Private Equity Strategies


Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Other Voices: Does the hedge fund industry benefit society?[more]

    This article was authored by Don Steinbrugge, Chairman of Agecroft Partners, a US-based global consulting and third party marketing firm for hedge funds. It is no secret that the hedge fund industry is viewed negatively by a la

  2. Private credit comes into focus for investors[more]

    Bailey McCann, Opalesque New York: As investors look for a way out of the low yield/no yield environment, private credit is becoming an increasingly attractive asset class, according to a white paper from Bayshore Capital Advisors. Private credit has grown steadily since the financial crisis as

  3. Other Voices: The role of diversification in CTA portfolios[more]

    2014 brought a resurgence of managed futures strategies, or CTAs, which performed very well as a whole, outperforming all other hedge fund strategies. However, a closer look reveals that there was a wide range of performance, or return dispersion, across managers. The bottom line? Not all CTAs

  4. Neuberger Berman unit buys 20% stake in activist hedge fund Jana Partners for $2bn[more]

    Komfie Manalo, Opalesque Asia: Neuberger Berman’s unit Dyal Capital Partners bought a 20% stake in activist hedge fund firm Jana Partners worth $2bn, WSJ.com reports. The deal comes as activi

  5. Hedge fund launches fall again, $1bn funds found to outperform even smaller hedge funds[more]

    Komfie Manalo, Opalesque Asia: The number of new hedge fund launches fell again in 2014, the third consecutive year of decline, while fund liquidations saw their first drop since 2010, according to the latest HFR Market Microstructure Industry Report released by industry data provider HFR. Acc

banner