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Rachel Adams-Heard - Bloomberg

(Bloomberg) — WaterBridge Holdings LLC, a U.S. company that handles water for the fracking industry, is scooping up more infrastructure in the Permian Basin, this time from private equity-backed drillers.

The closely held company has acquired almost 100 miles (161 kilometers) of pipeline and seven disposal wells from Primexx Energy Partners Ltd., Warburg Pincus’s Tall City Exploration III LLC and Blackstone Energy Partners’ Jetta Permian LP, it said Wednesday in a statement.

“When you’re in your early phase of exploiting your resource, it’s very difficult to continue to grow at the pace you want by only drilling what your cash flow will allow,” David Capobianco, chairman of WaterBridge and chief executive officer of Five Point Energy, which backs the company, said in an interview. “It’s pushing these producers to sell their water midstream assets.”

To finance the deals, WaterBridge issued $195 million of common equity to private equity firm Five Point Energy, an affiliate of Singaporean sovereign wealth fund GIC Pte, and to its own management. It also issued $150 million of preferred equity to Magnetar Capital, which has the right to acquire another $100 million. Read more…