The Goldman Sachs Group Incorporated is scheduled to pay $500 million for the acquisition of an energy stake in the investment company Riverside Holdings. The Wall Street Journal values this twelve percent stake at over $4 billion. Riverstone and Goldman both have their bases in New York although Riverstone has an additional office in Houston, Texas.
The founders of Riverstone will be reunited with their old energy team from Goldman in this deal. Before Riverstone was launched in 2000, Pierre Lapeyre Jr. and David Leuschen worked for the investment bank in New York dealing with their stock sales. Riverstone has since raised $36 billion from wealthy families, endowments and pensions.
Lapeyre and Leuschen have the reputation of using Goldman to find opportunities in investments and poach their talent. There are fourteen individuals on Riverstone’s investment committee whose resumes include Goldman. This includes Mark Papa who is the previous owner of EOG Resources Incorporated. This Houston based resources company worked with Riverstone during the period of time he was with Goldman.
Papa is now in the position of chairman and CEO for Centennial Resource Development. He was previously the chairman and CEO for the Silver Run Acquisitions Corporation. Last year the company combined with Centennial Resource. Papa and Riverstone founded Silver Run near the end of 2015. The company specializes in blank checks and when they went public it was with an initial offering to the public of $450 million.
Another blank check company sponsored by one of Riverstone’s affiliates is Silver Run Acquisition Corporation II. Earlier in the year the company raised approximately $1 billion by using their IPO. James Hackett is the leader of the company and he was previously the CEO and chairman of the Anadarko Petroleum Corporation. He joined up with Riverstone as one of their partners shortly after he left Anadarko.
Riverstone has been a participant in numerous energy deals in Houston. Riverstone sold Rock Oil Holdings LLC in October. This Denver and Houston based company sold to SM Energy Co. for $980 million. Goldman Sachs sees the oil and gas sector moving in a positive direction this year. They see an upside in the relation between the refiners and the biggest companies in the gas industry. This specifically includes an Ohio based company called Marathon Petroleum, Husky Energy out of Canada and Valero Energy located in San Antonio.