Lucid Energy Group Acquisition, Valuation, Funding & Investors
Lucid Energy Group was acquired by Targa Resources for $3.5B in June 2022.
Lucid Energy Group EBITDA multiple at acquisition
7.5x
EV/EBITDA · Jun 2022
Cumulative funding Lucid Energy Group raised
$600M
across 2 funding rounds
Key investors in Lucid Energy Group
Magnetar Capital
EnCap Flatrock Midstream
About Lucid Energy Group
Lucid Energy Group is a Dallas-headquartered midstream services provider operating in the Permian Basin. The company delivers gathering, treating, processing, compression, and transportation for natural gas producers in the Wolfcamp and Cline formations. Lucid manages greenfield facilities near Sterling City and San Angelo, Texas, with backing from EnCap Flatrock Midstream since its 2011 formation.
Founded
2011
HQ
Dallas, TXWebsite
Status
Acquired
Customer focus
B2B
Revenue model
Usage-based
Valuation
$3.5B (acquired Jun 2022)
Lucid Energy Group Acquisition
Lucid Energy Group was acquired by Targa Resources for $3.5B on 16 June 2022.
The acquisition price implies a 7.5x EBITDA multiple.
Before the acquisition Lucid Energy Group had raised $600M across 2 funding rounds.
Targa Resources Corp. announced on June 16, 2022, a definitive agreement to acquire Lucid Energy Delaware, LLC, a leading privately held natural gas processor in the Permian Basin's Delaware Basin, from Riverstone Holdings LLC and Goldman Sachs Asset Management for $3.55 billion in cash. Lucid operates the South Carlsbad and Artesia Natural Gas Gathering and Processing Systems in Eddy and Lea counties, New Mexico, adding 1,050 miles of natural gas pipelines and 1.4 Bcf/d of cryogenic processing capacity. Its assets are supported by long-term fixed-fee contracts and acreage dedications from diverse customers, with 70% of volumes from investment-grade producers like XTO and Marathon, covering over 600,000 dedicated acres with more than 20 years of drilling inventory. The acquisition expands Targa's midstream footprint in the Delaware Basin, aligning with its integrated strategy to drive more volumes through downstream businesses. It is financed with available cash, debt, and Targa's revolving credit facility, maintaining pro forma 2022 leverage around 3.5 times. The deal, at approximately 7.5 times estimated 2023 adjusted EBITDA, is expected to be immediately accretive to distributable cash flow per share, close in Q3 2022 subject to regulatory approvals, and enhance shareholder returns through dividends and repurchases.
| Acquirer | Date | Type | Price | EV/EBITDA |
|---|---|---|---|---|
| 16 Jun 2022 | Strategic M&A | $3.5B | 7.5x |
Lucid Energy Group Funding History
Lucid Energy Group has raised a total of $600M across 2 funding rounds.
Lucid Energy Group's first fundraising round was a $350M undisclosed-stage round in February 2016. The most recent completed round was a $250M undisclosed-stage round in May 2017.
Lucid Energy Group funding rounds
| Date | Stage | Investors | Raised | Deal Summary |
|---|---|---|---|---|
| May 2017 | Undisclosed stage | Magnetar Capital (lead) | $250M | Lucid Energy Group is a leading privately held natural gas processor and midstream provider in the Permian Basin, focusing on the Midland and Delaware Basins. It offers natural gas gathering, processing, and pipeline services with over 930 million cubic feet of processing capacity in operation or under construction and more than 3,600 miles of pipeline assets. The company serves producers with large-scale infrastructure anchored by long-term contracts. On May 2, 2017, Magnetar Capital committed up to $250 million in preferred equity to Lucid Energy Group to fund expansion of its natural gas gathering and processing systems in the Delaware Basin. Magnetar, managing nearly $14 billion in assets, acted as the lead investor, partnering with existing backer EnCap Flatrock Midstream. The investment supports aggressive growth of Lucid's franchise to provide best-in-class services to regional producers. Jefferies served as financial advisor to Lucid, with Vinson & Elkins as legal counsel, while Weil, Gotshal & Manges advised Magnetar. Lucid's management, led by President and CEO Mike Latchem, highlighted the partnership's role in enabling continued infrastructure build-out. Magnetar Head of Energy Eric Scheyer praised Lucid's execution on high-quality assets and long-term plans. Later developments include Lucid's 2018 acquisition by a Riverstone Holdings and Goldman Sachs joint venture for $1.6 billion, followed by Targa Resources' $3.55 billion cash acquisition in 2022, enhancing Targa's Permian footprint with Lucid's dedicated acreage and fixed-fee contracts. |
| Feb 2016 | Undisclosed stage | EnCap Flatrock Midstream (lead) | $350M | Lucid Energy Group II, LLC (Lucid II), a full-service midstream provider based in Dallas, secured an initial $350 million equity commitment from EnCap Flatrock Midstream on February 23, 2016. Lucid II was formed in December 2015 by the management team of its predecessor, Lucid Energy Group, LLC (Lucid I), which was also backed by EnCap Flatrock and operated a significant midstream footprint in the Midland Basin with over 700 miles of pipeline, multiple compressor stations, 345 million cubic feet per day of gas processing capacity, and other facilities serving more than 30 customers across nine West Texas counties. Lucid companies provide a full suite of midstream services, including natural gas gathering, processing, and crude oil gathering, to producers in high-growth onshore U.S. basins, with a focus on creative solutions, clear communications, and project execution excellence. Lucid I and II together received equity capital commitments exceeding $850 million from EnCap Flatrock, making them the largest privately held natural gas processor in the Permian Basin with 660 million cubic feet of processing capacity and over 3,300 miles of pipeline following acquisitions like Agave Energy. Operations are split with Lucid I in the Midland Basin and Lucid II targeting the Delaware Basin. The management team, led by President & CEO Michael J. Latchem, EVP & COO Jay L. Langham, and SVP & CCO Scott Brown, emphasized the financial strength from the EnCap partnership to pursue opportunities amid challenging commodity prices. In 2018, Lucid II was sold to a Riverstone Holdings and Goldman Sachs Merchant Banking joint venture for approximately $1.6 billion, highlighting strong asset performance and execution over six years, while EnCap retained ownership of Lucid I. |
Who has invested in Lucid Energy Group?
2 investors have backed Lucid Energy Group across its funding rounds, including Magnetar Capital and EnCap Flatrock Midstream.
Lead investors include Magnetar Capital and EnCap Flatrock Midstream.
Lucid Energy Group Investors
| Investor | HQ | Rounds | Role | First check |
|---|---|---|---|---|
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Benchmark 350K+ Funding Rounds and Disclosed VC Valuation Multiples
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Start Free TrialAcquisitions by Lucid Energy Group
Lucid Energy Group has acquired 1 company to date.
Last acquisition by Lucid Energy Group was on September 1st 2016. Lucid Energy Group acquired Agave Energy Company for undisclosed valuation.
Latest Acquisitions by Lucid Energy Group
| Description | Agave Energy Company is an independent midstream operator managing natural gas gathering systems and processing plants in the Delaware Basin of southeastern New Mexico and the Powder River Basin of eastern Wyoming. The company handles compression, dehydration, and fractionation services for producers in these prolific shale plays. Headquartered in Artesia, New Mexico, it maintains over 300 miles of pipelines connecting to major interstate systems. |
| HQ Country | |
| HQ City | Artesia, NM |
| Deal Date | 1 Sep 2016 |
| Valuation | undisclosed |
| EV/Revenue | |
| EV/EBITDA | |
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Lucid Energy Group Competitors
Lucid Energy Group competitors include listed companies like Teekay Tankers, DHT Holdings, Jiangxi Jovo Energy and Topaz Energy, and private ones like TANAP and Hyundai Oilbank.
| Company | HQ | Status | Revenue | EBITDA | Valuation | Revenue Multiple |
|---|---|---|---|---|---|---|
| United States | Publicly listed | $952M | $407M | $3.5B | 2.6x | |
| United States | Publicly listed | $498M | $329M | $3.7B | 5.5x | |
 China | Publicly listed | $3B | $289M | $3.4B | 0.9x | |
 Canada | Publicly listed | $233M | - | $3.4B | 13.2x | |
 Ankara | Private | - | - | $4B | - | |
 Cheongju | Private | $18B | - | $8.8B | 0.5x |
Lucid Energy Group Public Comps
Lucid Energy Group is no longer listed, but its public comps include Mesaieed Petrochemical, Peyto, Aegis Vopak Terminals, Teekay Tankers, Shanghai Petrochemical, Athabasca Oil, Paramount Resources, Viva Energy Australia, DHT Holdings and Jiangxi Jovo Energy.
| Last FY | EV/Revenue | EV/EBITDA | ||||||
|---|---|---|---|---|---|---|---|---|
| Revenue | EBITDA | Last FY | LTM | 2027E | Last FY | LTM | 2027E | |
| $151M | - | 23.3x | - | - | - | |||
| $791M | $713M | 5.4x | 4.2x | 6.0x | 5.3x | |||
| $96M | $73M | 41.1x | 36.2x | 54.2x | 47.8x | |||
| $952M | $407M | 2.4x | 2.6x | 5.7x | 4.0x | |||
| $11B | $23M | 0.3x | 0.3x | 134.8x | 30.2x | |||
| $976M | $333M | 3.7x | 3.7x | 11.0x | 9.3x | |||
| $729M | $277M | 4.3x | 4.6x | 11.3x | 5.3x | |||
| $20B | $267M | 0.4x | 0.3x | 27.8x | 8.3x | |||
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Common questions about Lucid Energy Group
| When was Lucid Energy Group founded? | Lucid Energy Group was founded in 2011. |
| Where is Lucid Energy Group headquartered? | Lucid Energy Group is headquartered in Dallas, TX, United States. |
| Is Lucid Energy Group publicly listed? | No, Lucid Energy Group was acquired by Targa Resources in June 2022. |
| Who acquired Lucid Energy Group? | Lucid Energy Group was acquired by Targa Resources in June 2022. |
| How much was Lucid Energy Group acquired for? | Lucid Energy Group was acquired for $3.5B in June 2022. |
| How much funding has Lucid Energy Group raised? | Lucid Energy Group has raised $600M across 2 funding rounds. |
| What was Lucid Energy Group's last funding round? | Lucid Energy Group's last funding round was a $250M undisclosed-stage round in May 2017, led by Magnetar Capital. |
| Who are Lucid Energy Group's investors? | Lucid Energy Group's investors include EnCap Flatrock Midstream and Magnetar Capital. |
| Which companies are comparable to Lucid Energy Group? | Companies comparable to Lucid Energy Group include Teekay Tankers, DHT Holdings, Jiangxi Jovo Energy, Topaz Energy, TANAP and Hyundai Oilbank. |
| How many companies has Lucid Energy Group acquired? | Lucid Energy Group has acquired 1 company, including Agave Energy Company. |
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