EnCap-backed Triple Oak Power sale process attracting PE interest, sources say

The sale process for renewable energy development company Triple Oak Power is attracting both financial sponsors and strategic companies seeking to establish a presence in the burgeoning US onshore wind power market, four sources familiar with the matter told PE Hub.

Marathon Capital is advising the sale process for the company, which is backed by EnCap Investments, Yorktown Partners and global energy and commodity trading company Mercuria Energy. Currently in the second round, a sale of the Portland, Oregon-based company is expected to wrap up in October.

With a 7.5GW development pipeline and small operating portfolio, the target company is likely to see between $500 million and $750 million in sale proceeds, based on its nimble corporate structure and capital light business model, two of the sources said.

One source said Triple Oak could be attractive to another PE investor or a foreign strategic firm based on its management team’s experience developing projects throughout the West Coast and Upper Midwest region. The nascent company formed in 2020, with less than 30 employees, making it an easy add-on acquisition for either a sponsor or new market entrant strategic, while management would stay involved following a deal, the source added.

“There’s a huge shortage of quality wind development companies, and new operating assets outside of the ERCOT (Electric Reliability Council of Texas) market right now,” said the source, pointing out the company’s western and Midwest market presence, and its management team’s prior experience at Iberdrola’s US utility Avangrid, as selling points for Triple Oak.

Marathon Capital, a Chicago-based renewable energy investment bank, kicked off a sale for the target company in May, the sources added.

Triple Oak Power would represent a third exit for EnCap Energy Transition I, the inaugural energy transition and sustainable infrastructure fund of Houston-based EnCap, a historic upstream oil and gas and midstream energy private equity group.

In August, EnCap and Apollo Global Management agreed to sell Broad Reach’s battery storage business to Engie, a utility company based in La Défense, France. Yorktown Partners and Mercuria Energy Group were also co-selling sponsors. For more on that deal, see PE Hub’s interview with Shawn Cumberland, EnCap Energy Transition managing partner.

EnCap, along with Yorktown and Mercuria, sold battery storage developer Jupiter Power to BlackRock in a deal announced in November 2022.

In November 2022, Triple Oak reached an agreement for the sale of the Prairie Switch wind farm, a 160MW facility located outside of Houston, to infrastructure investor Fengate Capital Management. Social media operator Meta became a purchaser of power generated by the Texas wind farm, according to a press release.

EnCap Energy Transition I had a hard close of $1.2 billion in April 2021. The firm’s second sustainable fund, Energy Transition II, is currently fundraising, with $993.2 million secured toward a $1.2 billion hard-cap.

EnCap and Marathon Capital declined to comment. Triple Oak, Yorktown and Mercuria did not respond to requests for comment.