Family Capital’s Deal of the Year

There were many outstanding deals transacted by family-backed investment groups in 2018, but perhaps one, or more precisely a number of deals linked to one family, stood out in 2018 – and that family were the US-based Bass brothers.

At the start of the year, the Bass brothers sold a plot of land for around $6 billion to the world’s biggest oil company, ExxonMobil. That land – in the Permian Basin area of western Texas and the southeastern part of New Mexico – contains one of the most lucrative oil and gas reserves in the US. And ExxonMobil was willing to pay a lot of money for it. That’s why it must stand out as one of the most outstanding family-led investment deals of 2017.

With much of the world economy preoccupied with technology-led hype, the Bass brothers’ Permian deal underlines that land, particularly land with fossil fuels linked to it, still commands huge price tags. And these deals remain an important driver of the world economy, regardless of all the money being made from Silicon Valley-linked businesses.  

The beneficiaries were four brothers – Sid, Robert, Ed and Lee Bass. The Bass family derive their fortune from Sid Richardson – a classic Texan oil man of the oil boom years in the early 20th century. Richardson became an oil tycoon, but being a bachelor with no children, he left a sizable chunk of his fortune to his nephew, Perry Bass, the father of the four Bass brothers.

All four brothers have used their inheritance wisely and enhanced their fortunes through their own efforts. But perhaps Robert Bass stands out as doing more so, at least in 2017, due to the activities of his investment group, Oak Hill Capital Partners. Starting off as a family office for Robert back in 1986, Oak Hill has since morphed into a private equity group, although a big part of the money used for its deals still comes from Robert Bass’s personal fortune.

And five months after the ExxonMobil, Oak Hill did one of its biggest deals – the sale of Wave Broadband for $2.3 billion. Wave Broadband was bought by Oak Hill and another private equity firm for under $1 billion back in 2012. So Robert had an even better year than his brothers in realising two very successful deals in 2017. And, as such, perhaps his name should be linked to the family-linked deal(s) of the year.