Tailwater Capital Closes on $1.1 Billion of Debt and Equity to Recapitalize Producers Midstream II for Future Growth

The capital raise is comprised of i) $600 million from an upsized senior credit facility and ii) $500 million of equity capital commitments from existing and new investors, including an allocation from newly formed Tailwater Fund V

DALLAS, Oct. 8, 2025 /PRNewswire/ -- Tailwater Capital LLC ("Tailwater Capital"), an energy and infrastructure private equity firm, announced the successful closing of approximately $500 million of equity capital commitments to extend and grow its partnership with Producers Midstream II, LLC ("Producers Midstream" or the "Company"), a leading provider of midstream solutions in New Mexico, Texas and Oklahoma. The continuation vehicle, managed by Tailwater Capital, is anchored by Secondaries at Goldman Sachs Alternatives and supported by new and existing Tailwater limited partners. The investment also includes a separate equity commitment from newly formed Tailwater Fund V and related vehicles. The continuation vehicle and Fund V commitments include a significant primary equity component to support the Company's growth across its asset footprint.

In conjunction with the investment closing, Producers Midstream has expanded its senior secured credit facility from $400 million to $600 million. The expanded facility, led by Texas Capital Bank, strengthens the Company's balance sheet and provides increased flexibility to fund development across its entire asset footprint in New Mexico, Texas and Oklahoma.

"Tailwater is proud to continue supporting Producers Midstream as they execute on a proven strategy and pursue new opportunities for growth," said Stephen Lipscomb, Partner at Tailwater Capital. "This transaction reflects the strength of the platform, the confidence of our investors, and the leadership team's strong executional capabilities."

"The closing of this capital raise marks a significant milestone for Producers Midstream, strengthening both our capital position and our ability to serve customers with flexible and creative solutions," said Matt Flory, Chief Executive Officer of Producers Midstream. "It is a testament to the hard work of our team and the continued trust of our partners."

Producers Midstream operates a diversified system of gathering and processing and long-haul assets across multiple basins, with over 3,300 miles of pipeline and approximately 860,000 dedicated acres. The platform's Lea County system, anchored by more than 85,000 acres of long-term dedications, is positioned to be a key growth driver amid upstream activity, stemming from a significant inventory of attractive Tier 1 locations tied to the Company's system in the Northern Delaware Basin.

Most recently, Producers Midstream completed the start-up and commissioning of The Dude processing plant in Lea County and began processing and treating natural gas for customers in the region. As a result of its leading in-service timing and cost advantages, the Company successfully secured multiple anchor contracts with high-quality counterparties. The Company has plans to expand the total processing capacity to 240 MMcfd by Q3 2026.

In addition, Producers Midstream owns and operates the Palo Duro Pipeline which is a 300-mile long-haul pipeline capable of providing gas delivery service throughout the "Data Center Corridor" from Abilene, TX up to Oklahoma. The Company plans to use a portion of the primary capital to expand and commercialize the pipeline to provide optimal pricing and reliability to end users.

Campbell Lutyens served as exclusive financial advisor to the transaction. Kirkland & Ellis LLP acted as legal advisor for Tailwater in connection with the continuation vehicle transaction and for Producers Midstream in connection with the senior credit facility.

About Tailwater Capital
Dallas-based Tailwater Capital is an energy and infrastructure private equity firm with a well-established track record of working constructively with proven management teams to deliver value-added solutions. Tailwater has raised more than $6 billion in committed equity capital since inception, and the team has executed more than 235 transactions representing over $28 billion in value. For more information, please visit www.tailwatercapital.com.

About Producers Midstream
Founded in 2016, Producers Midstream is committed to maximizing the value of producers' operations by creating bespoke midstream systems, capable of increased reliability and predictability, supported by a culture of service, ingenuity, and responsiveness. For more information, please visit www.producersmidstream.com.

About Goldman Sachs Alternatives
Goldman Sachs is one of the leading investors in alternatives globally, with over $500 billion in assets and more than 30 years of experience. The business invests in the full spectrum of alternatives including private equity, growth equity, private credit, real estate, infrastructure, sustainability, and hedge funds. Clients access these solutions through direct strategies, customized partnerships, and open-architecture programs. The business is driven by a focus on partnership and shared success with its clients, seeking to deliver long-term investment performance drawing on its global network and deep expertise across industries and markets. The alternative investments platform is part of Goldman Sachs Asset Management, which delivers investment and advisory services across public and private markets for the world's leading institutions, financial advisors and individuals. Goldman Sachs has approximately $3.3 trillion in assets under supervision globally as of June 30, 2025. Follow us on LinkedIn.

Tailwater Contacts

Jill McMillan
Managing Director, Communications & Public Affairs
Phone: 214-489-7047
Email: [email protected] 

John Schaufele
Managing Director, Investor Relations & Fundraising
Phone: 214-489-7043
Email: [email protected] 

Producers Midstream Contacts

Hudson White
Chief Financial Officer
Phone: 214-238-5750
Email: [email protected] 

Clark Hudnall
Chief Strategy Officer
Phone: 214-238-5754
Email: [email protected]

SOURCE Tailwater Capital