March 10, 2018 / 1:23 AM / 10 days ago

Williams Co's PE partners in Caiman Energy II seek to cash out-sources

HOUSTON, March 9 (Reuters) - U.S. pipeline operator Williams Co’s private equity partners in a midstream venture dubbed Caiman Energy II are looking to sell their minority stakes for as much as $1 billion, according to four people familiar with the matter.

Buyout firms EnCap Flatrock Midstream and Oaktree Capital Group LLC own a significant minority position in Caiman Energy II, with Williams controlling the majority, according to the sources.

Caiman Energy II owns half of Blue Racer Midstream, a network of pipelines which moves natural gas in the Utica and Marcellus shale formations. Dominion Energy Inc is the other partner in that venture.

A sale process that will result in EnCap Flatrock and Oaktree exiting their investment in Caiman Energy II is currently ongoing, according to the sources, who spoke on condition of anonymity as the information is not public.

The deal is expected to be worth between $750 million and $1 billion, the sources said. Barclays Plc and Citigroup Inc are arranging the sale, two of the sources said.

EnCap Flatrock and Oaktree declined to comment. Barclays and Citigroup did not immediately respond to requests for comment.

Caiman Energy II was formed in 2012. In December that year, it announced it was forming Blue Racer Midstream, the $1.5 billion joint venture with Dominion. The energy firm provided assets and Caiman Energy II the investment capital for that venture. (Reporting by David French in Houston Editing by Leslie Adler)

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