SK Holdings Co Ltd has agreed to invest $300 million in Blue Racer Midstream LLC, a portfolio company of First Reserve. Blue Racer owns, operates, and develops midstream assets in the Utica and Marcellus Shale plays of the United States.
FIRST RESERVE ANNOUNCES STRATEGIC INVESTMENT BY SOUTH KOREAN COMPANY SK HOLDINGS CO., LTD. IN BLUE RACER MIDSTREAM, LLC
SEOUL, SOUTH KOREA; STAMFORD, CONN; HOUSTON; DALLAS; LONDON. – March 27, 2019 – First Reserve, a leading global private equity investment firm exclusively focused on energy, today announced an agreement with SK Holdings Co., Ltd. (“SK”), a top two conglomerate in South Korea, for an investment of $300 million into a fully integrated midstream company in the Utica and Marcellus Shale plays.
Blue Racer Midstream, LLC (“Blue Racer” or “the Company”) is a portfolio holding of First Reserve Fund XIII, funded in part by equity from First Reserve Fund XIII and investment funds affiliated with First Reserve, following the acquisition of a 50% interest in December 2018. The Blue Racer investment represents a sizeable addition to SK’s North American midstream platform as well as the formation of a strategic relationship with energy investor First Reserve.
SK’s diverse global portfolio of investments focus on driving competitive, long-term shareholder value in key growth industries such as the energy sector. As a strategic investor, SK will work alongside First Reserve and company management in supporting Blue Racer’s growth and initiatives to expand the Company’s regional footprint.
Blue Racer owns, operates, and develops midstream assets in the Utica and Marcellus Shale plays of the United States. The Company provides interconnected midstream functionalities with more than 700 miles of gathering pipeline and 1 billion cubic feet per day of cryogenic processing capacity. Blue Racer believes its strategically located assets and contractual relationships with material customers will allow it to retain and grow its position as a leading midstream company serving customers in the Appalachian basin.
Alex Krueger, President & CEO of First Reserve, stated, “With over 35 years’ experience as energy-focused investors, First Reserve has developed what is in our view a deep understanding of the global energy value chain, energy operations, and the key centers of energy activity. We believe Blue Racer is a well-positioned business in a growing market, and we are excited to welcome SK as a strategic investor in the company. We believe this partnership will serve as a strong complement to our expertise, and we deeply value the experience that SK will bring to the Blue Racer investment. We look forward to a long-term relationship with the SK organization as we seek to drive growth on behalf of both Blue Racer and our stakeholders.”
Dong Hyun Jang, CEO of SK Holdings Co., Ltd. added, “SK has built a substantial platform of energy investments throughout North America, providing what we believe is a robust investment foothold in an energy epicenter. This investment in Blue Racer and the partnership with First Reserve, a leading global private energy investment firm, are a continuation of that investment thesis – and the opportunity to combine our strategic expertise with experienced energy players. We believe Blue Racer is a premier midstream operator, and we look forward to helping build value through our energy business capabilities and synergy with shale-related assets in the U.S.”
Transaction terms were not disclosed.
About First Reserve
First Reserve is a leading global private equity investment firm exclusively focused on energy. With over 35 years of industry insight, investment expertise and operational excellence, the Firm has cultivated an enduring network of global relationships and raised approximately USD $31 billion of aggregate capital since inception. First Reserve has completed over 650 transactions (including platform investments and add-on acquisitions), creating several notable energy companies throughout the Firm’s history. Its portfolio companies have operated on six continents, spanning the energy spectrum from upstream oil and gas to midstream and downstream, including resources, equipment and services, and associated infrastructure. Please visit www.firstreserve.com for further information.