PRIVATE equity firm Riverstone Holdings yesterday said it is planning to float a new energy investment vehicle, Riverstone Energy, on the London Stock Exchange, in an initial public offering to raise up to £1.5bn.
Lord Browne, former boss of oil major BP, is a partner at Riverstone Holdings and will take a board seat at Riverstone Energy, marking his return to the UK’s public markets after leaving BP in 2007.
Riverstone Energy said it has already received £500m in binding commitments from a group of cornerstone investors and £50m from Riverstone Holdings. It is looking to raise a further £950m before the shares are admitted to London’s main market on 29 October.
The number of shares issued in total and the price would be determined by demand, a spokesman said.
Other members of the board include Riverstone’s founders Pierre Lapeyre and David Leuschen, who are both former managing directors at Goldman Sachs, alongside James Hackett, previously at Anadarko Petroleum Corporation, and ex-JP Morgan Chase executive Peter Barker.
Europe has seen a surge in initial public offerings this year as market confidence improves. London has been a big driver of activity.
“Riverstone Energy presents a unique opportunity for public market investors to gain exposure to the energy sector,” said Wilson yesterday.
“[It] will fill an important space in the London market, enabling investors to access the investment gap between the mature majors and the smaller exploration and production players.”
Leuschen and Lapeyre said they were “extremely encouraged by the interest and support shown by our cornerstone investors”.
“They will be able to participate alongside Riverstone in the transformation that is taking place in the global energy sector,” the pair added in a statement.
Riverstone is also a part-owner of privately-owned shale gas explorer Cuadrilla, of which Lord Browne is chairman.
PROFILE: THE SUN KING RISES
LORD Browne, the former chief executive of FTSE 100 oil giant BP who was once known as the Sun King of the oil industry, will be making his return to a London-listed boardroom once Riverstone Energy floats later this year.
Browne has been a partner at private equity firm Riverstone Holdings – the world’s largest renewable energy fund - since leaving BP. He originally joined BP in 1966 and later ran it for over a decade, taking the firm into its lucrative but tempestuous joint venture in Russia, named TNK-BP. The physics graduate also took the firm into its game-changing mergers with Amoco and Atlantic Richfield.
However, he dramatically quit in 2007 after he admitted to lying in court over how he met his then-partner, Jeff Chevalier.
To add to Browne’s BP hangover, some critics later attributed the 2010 Gulf of Mexico oil spill – presided over by his successor Tony Hayward – to Browne’s “ruthless” cost-cutting programme during his tenure, a claim that Browne disputed.
Browne is currently chairman of shale gas explorer Cuadrilla, which is searching for fuel at several sites across the UK but has come under attack from environmentalists who are opposed to the fracking technique.
Browne was also appointed the UK government’s lead non-executive board member in June 2010, a role in which he recruits business leaders to reformed departmental boards.
He was knighted in 1998 and made a life peer in 2001.
Goldman Sachs and JP Morgan Cazenove are joint global coordinators on the initial public offering, while Deutsche Bank and Morgan Stanley are acting as joint bookrunners. Berenberg and Tudor, Pickering Holt & Co are co-lead managers on the transaction.
Andrew McNally and Chris Snoxall are leading the team at Berenberg. McNally is head of European capital markets and joined the firm in 2003, prior to which he was at Morgan Stanley. Snoxall joined Berenberg in 2013, after 17 years of UK equity capital markets experience. He has worked on a number of high profile transactions including IPOs, pre-emptive issues, returns of share capital and stakebuilds.
Tadhg Flood and Lorcan O’Shea lead Deutsche Bank’s team. O’Shea is a managing director and has led a number of deals including the IPO of insurer Esure. Flood is a managing director and co-head of the global financial institutions group at Deutsche Bank.
Richard Cormack, Dan Martin and Brian O'Keeffe were the key members of the Goldman’s team and Jonathan Wilcox, Greg Chamberlain and Edward Gibson-Watt led the team at JP Morgan.
At Morgan Stanley it was Simon Parker and Martin Thorneycroft, while Jon Melberg headed up the team at Tudor.