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ABOUT THE AUTHOR
Sarah McLean, a partner in Shearman & Sterling's Energy
Transactions practice in Texas, has over 20 years of experience
as a trusted advisor to private equity funds and management
teams focused on the energy sector. She has represented them
in connection with portfolio company investments, acquisitions
and divestitures of upstream and midstream oil and gas assets
and companies, formations of joint ventures, and various private
equity transactions, project documents and operating
agreements across the entire oil & gas value chain.
After growing up in northwest Oklahoma, she obtained a B.S. in
Biochemistry and Molecular Biology, with honors, from Oklahoma
State University and a J.D. from the University of Texas School
of Law. Sarah and her children are active volunteers with
Generation Serve and the recipients of the 2018 Wally Pilcher
Family Volunteering Award.
Sarah can be contacted at sarah.mclean@shearman.com.
Preface
Private equity funds have supplied much of the capital injected
into the oil and gas exploration and production sector over the last
decade. These investors will typically seek to identify, acquire,
operate, enhance, and ultimately exit from an investment within a
defined investment period. Assembling a strong management
team at the front end of an investment and maximizing returns
with a clean exit at the back end are two key areas of focus for a
typical private equity fund investor, and these points often drive
considerations for the counterparties in private equity deals.
The intent of this chapter is to provide an overview of key
concepts and provisions likely to be raised (other than with
respect to tax provisions) when negotiating purchase and sale
agreements (PSAs) with private equity-backed companies. The
provisions discussed and solutions suggested in this chapter are
not in any way meant to be exhaustive either as to the provisions
that impact Buyers and Sellers who do business with PE Sellers
or PE Buyers or as to the compromises with respect to such
provisions, but are intended to assist counterparties that find
themselves buying oil and gas assets from, or selling those
assets to, private equity-backed entities.