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ACON and CIPEF Acquire Colombian Oil & Gas Producer, Vetra

30 July 2013

(PR Newswire) Capital International Private Equity Fund VI, L.P. (“CIPEF VI”) and an affiliate of Acon Investments LLC (“ACON”) have jointly acquired Vetra Energia, S.L. (“Vetra”), one of the largest privately held independent oil producers in Colombia.

The sellers include Inveravante, an investment firm based in La Coruna, Spainaffiliated with Mr. Manuel Jove Capellan, as well as several minority shareholders of the company. Inveravante and its partners retain their stake in Monclova Pirineo Gas S.A. de C.V., an oil services company that operates four blocks in Mexico, that was spun off from Vetra.

With significant exploration and production in the Putumayo, Llanos and Middle Magdalena Basins, Vetra’s net production during the first half of 2013 exceeded 6,100 bpd. As a result of successful drilling programs in the company’s Cohembi (Putumayo) and Santo Domingo (Llanos) fields, the company’s net production for the first half of 2013 has increased by 68% year-over-year and reached a record 8,243 bpd on June 30th, 2013.

The company’s development portfolio aggregates over 18 MMBbls of net proved and probable reserves certified as ofDecember 31, 2012, which are expected to increase materially in the June 30, 2013 reserve certification due to the successful drilling program in the Cohembi field as well as the positive results from the water-flooding program initiated in December 2012.

In addition to its producing assets, Vetra has an extensive portfolio of exploration concessions awarded by the Agencia Nacional de Hidrocarburos (“ANH”) during the 2010 and 2012 bidding rounds. These concession blocks are distributed between the Putumayo and Llanos Basins and represent a significant upside opportunity for the company.

Vetra was founded in 2003 by a group of Venezuelan oil industry veterans led by Mr. Humberto Calderon Berti, Vetra’s Chairman, and formerly the President of PDVSA, President of OPEC, Venezuela’s Minister of Energy and Mines, and Minister of Foreign Relations; as well as Mr. Ignacio Layrisse, Vetra’s CEO, who formerly held several senior positions at PDVSA including Technical and Development Director.

Founded in 1996, ACON is a private equity investment firm focused on the United States and Latin America with over $2.8 billion of capital managed. ACON invests throughout Latin America focusing on industries or businesses at key inflection points in their development and pursues these opportunities in close partnership with established management teams. ACON has offices and investment professionals throughout the Americas including Mexico City and Sao Paulo. ACON’s investment in Vetra will be funded with equity commitments from ACON Latin America Opportunities Fund, L.P. (“ALAOF”), ACON’s third pool of capital for the region, as well as with equity commitments from its co-investors. Other investments completed by ACON inColombia include Almacenes Vivero, Carulla y Cia, Credivalores and Grupo Sala.

With $3 billion in commitments, CIPEF VI is the sixth private equity fund of Capital International Private Equity Funds (“CIPEF”). CIPEF is focused on investments in leading companies across the global emerging markets and, since inception in 1992, CIPEF has made 78 investments across 25 countries and 34 industries. CIPEF is part of The Capital Group, an independent global investment management organization with over 80 years of experience. In Latin America, CIPEF has completed 12 transactions over the last 12 years investing more than $1 billion. Vetra will be CIPEF VI’s first investment in Latin America, following previous investments from prior CIPEF funds in the region such as Arcos Dorados, QGOG Constellation, Bancolombia and Jumbo Retail Argentina, among others.

Members of Vetra’s management team as well as several of the original investors in Vetra, rolled over their stake in the company and invested equity alongside CIPEF and ACON.

Founded in 2007 by Mr. Manuel Jove Capellan, Inveravante is an international holding company active in the power sector (Avantegenera), real estate (Avantespacia), financial services (Capitavante) as well as in the food & beverage sector through its ownership of various leading wineries (Avanteselecta). Avante Genera is focused on the development of independent renewable generation capacity around the world with approximately 400 MW of projects operational or under construction including wind power in Spain, Canada and Brazil, solar energy in Spain and hydroelectric power in Panama and Brazil. The company is also pursuing a pipeline of projects with total installed capacity in excess of 1,000 MW.

Martin Diaz Plata, Managing Partner of CIPEF stated, “The combination of exploration and production assets of Vetra represents an attractive risk return balance for CIPEF and we believe Vetra is well positioned to benefit from continued progress in Colombia in infrastructure as well as security and social and economic development.”

Jose Miguel Knoell, Partner of ACON, added, “We believe that Colombia represents one of the most compelling opportunities in the Western Hemisphere to invest in the oil & gas sector given its attractive and predictable regulatory environment and vast new prospects after several decades of underinvestment across many regions of the country. We are very enthusiastic about partnering with Mr. Calderon and his team to continue developing Vetra as a platform for capturing this exciting market opportunity.”

Humberto Calderon Berti, President of Vetra, added, “together with our former partners of Inveravante, we have completed a phase of consolidation and growth that now, with the participation of our management, technical and other staff, together with our new partners ACON and CIPEF, will be strengthened to make Vetra one of the most important companies in this sector in the region.”

Antonio de la Morena, Managing Director of Inveravante, concluded, “we are pleased with the acquisition of Vetra by ACON and CIPEF, as we believe that it sets the stage for a new and successful phase in Vetra’s development, after 5 years of being a controlling shareholder, in which we and the management team have been able to transform Vetra from being a service-focused start-up to one of the largest and most successful independent producers in Colombia.” The selling shareholders were advised by Horizon Capital, a merchant bank specializing in natural resource industries, and by Cuatrecasas Gonzalves Pereira.