HarbourVest backs $1.9bn Lime Rock restructuring

HarbourVest Partners has emerged as lead backer of a $1.9 billion energy fund restructuring.

The Boston-headquartered firm led a group of investors that backed a fund formed to acquire the remaining net asset value held in Lime Rock Partners IV, a 2006-vintage vehicle managed by upstream oil and gas investment manager Lime Rock Partners, according to a statement.

Continuation vehicle Lime Rock Partners IV AF received $741 million in capital commitments from a group of secondaries and primary investors, with Lime Rock employees accounting for the largest proportion of investment. Investors in Fund IV were given the option to reinvest in the acquisition fund or cash out with full or partial liquidity, the statement noted.

It is not clear how many LPs reinvested and how many cashed out.

Evercore advised the buyers on the deal. Morgan, Lewis & Bockius served as legal advisor to Lime Rock, Debevoise & Plimpton to HarbourVest.

Lime Rock will maintain management of the vehicle, giving it time to maximise the value of oil and gas producer CrownRock, which accounts for a “vast majority” of the fund’s remaining net asset value, the statement noted.

CrownRock operates in the Permian Basin in Texas, the largest petroleum producing basin in the US.

In its 2018 Secondary Market Review advisor and placement agent Campbell Lutyens noted that secondaries buyers completed an average of 3.5 single-asset deals last year.

Lime Rock Partners has $7.4 billion in assets under management, according to PEI data. It is in market with Lime Rock Parnters VIII, which seeking $1 billion.