ACON Investments Makes Gas Play

ACON Investments LLC, the Washington, D.C. investment firm, has established Saga Resource Partners as a holding company for its acquisition of assets from Saga Petroleum Corp. and other natural gas assets it acquired from an undisclosed seller. ACON led an investor group comprised of the management team of Saga Petroleum Corp., GCP Capital Partners, Wells Fargo Energy Capital, Inc. and Société Générale Investment Corporation in financing the acquisitions. Terms of the transaction were not disclosed.

PRESS RELEASE:

Washington, D.C. – August 11, 2011 –ACON Investments LLC (“ACON”) and the management team of Saga Petroleum Corp. announced today that they have formed Saga Resource Partners LLC (“SRP”) to acquire the Black Warrior Basin assets of Saga Petroleum Corp. as well as Black Warrior Basin coal-bed methane assets from an undisclosed seller. ACON led an investor group comprised of the management team of Saga Petroleum Corp., GCP Capital Partners, Wells Fargo Energy Capital, Inc. and Société Générale Investment Corporation in financing the acquisitions. Terms of the transaction were not disclosed.

SRP will become one of the leading coal-bed methane producers in the Black Warrior Basin of Alabama, with over 600 producing wells and proved reserves of over 170 billion cubic feet of natural gas. SRP will continue Saga’s environmentally sound and operationally efficient drilling and production processes. As part of their investment, ACON and the co-investors have committed significant additional capital to enable SRP to further develop its asset base and to acquire additional strategic and synergistic assets.

“We look forward to partnering with the Saga team to cost-effectively grow the existing asset base organically and to seek accretive acquisitions going forward,” said Mo Bawa, a Principal at ACON. “We are impressed with the Saga team’s technical and operational expertise and performance record.”

“In Saga’s 18 year history of acquisitions, operations and development of properties in the Permian Basin, Rocky Mountains and Black Warrior Basin, this is the first time Saga has participated in a partnership with private equity investors. We are very pleased to have ACON as the lead equity investor, and we believe our equity sponsors will make ideal partners to expand our asset base. Our goal is to grow the assets of SRP through adding and developing operated properties in onshore basins that exhibit low-geologic risk,” said Chuck Farmer, President of SRP.

Bank financing for the transaction was led by Société Générale and includes Wells Fargo, Associated Bank and ING Bank.

ACON Investments
With offices in Washington, D.C., Los Angeles, CA, Mexico City, Sao Paulo, Brazil and Madrid, Spain, ACON is a middle market private equity investment firm with approximately $2.0 billion of capital under management. Founded in 1996, ACON manages private equity funds and special purpose investment partnerships with investments in the United States and Latin America. ACON pursues a theme-based investment strategy by focusing on industries or businesses at key inflection points in their development and pursues these opportunities in close partnership with established management teams. For more information about ACON Investments, please visit www.aconinvestments.com.

GCP Capital Partners
GCP Capital Partners currently manages five private equity funds with $1.9 billion of committed capital. Headquartered in New York, NY, GCP primarily invests in middle market companies in the business services, education, energy, financial services, insurance and telecommunications industries. GCP Capital Partners is the successor to Greenhill Capital Partners, the merchant banking business of Greenhill & Co., Inc. (NYSE: GHL) that was founded in 2000. For more information about GCP Capital Partners, please visit www.gcpcapital.com.