Five Point closes debut fund on $450 million

The fund will focus on midstream energy opportunities

Texas-based Five Point Capital Partners has closed its inaugural fund on $450 million. The vehicle beat its target of $400 million, and closed on the hard-cap.

Five Point is led by David Capobianco and Matthew Morrow, both of whom have extensive experience in energy investing. Capobianco co-founded and was co-head of the private equity unit of Microsoft co-founder Paul Allen’s Vulcan Capital, before starting Five Point.

To date, Five Point has made two investments from the fund – Twin Eagle Resource Management, a midstream energy infrastructure and energy marketing business and Redwood Midstream, a multi-phase oil, gas, and liquids gathering and processing business. The Fund will focus on investments in the midstream energy infrastructure sector.

“We are looking at all of the shale opportunities in the US,” Capobianco tells Private Equity International.

“We are targeting 6-8 platforms with multiple acquisitions inside those platforms. The investment will be a combination of capital committed from the fund, alongside direct and co-investments from our LPs. We have a number of LPs that are interested in co-investing with us, so you could see total commitments double that of what comes from the fund itself.”

He notes that despite the recent pullback in the price of oil, the development of shale still represents a 10-20 year secular growth trend. Over the near term, he also sees value opportunities as players work through the slowdown. “We anticipate pockets of distressed opportunities as people start to sell off assets that may no longer be prudent. We also see opportunities in infrastructure assets.”

Mercury Capital Advisors served as the placement agent for the fund.