Arroyo Energy Investment Partners is seeking to raise $900m for its fifth flagship fund, targeting midmarket energy infrastructure investments as rising US electricity demand creates opportunities across power generation and fuel infrastructure, according to a report by The Wall Street Journal.
The target for Arroyo Investors Fund V reportedly exceeds the $680m raised for its predecessor, which closed last year alongside $385m in co-investment capital. The Texas-based firm, which manages approximately $4bn, is also targeting around $500m in co-investments for its latest vehicle.
Arroyo typically invests between $100m and $300m per transaction, focusing on operating or near-complete energy infrastructure assets, including liquefied natural gas facilities, power generation businesses and natural gas pipelines. Its strategy reportedly targets midmarket operators benefiting from increased electricity consumption driven by AI data centres, domestic manufacturing and electrification.
Previous investments include Life Cycle Power, a provider of portable natural gas-fired electricity generation, which Arroyo sold to Partners Group in 2025 after investing $355m through its third flagship fund. The transaction generated a gross return of 2.9x invested capital. The firm also reportedly invested $179m in LNG infrastructure operator Seaside LNG, alongside $149m from co-investors.
Arroyo reported an aggregate net return of 1.7x invested capital across its funds through March 2026. Its latest fundraising presentation identified five prospective transactions involving approximately $875m of fund capital, alongside potential co-investments, spanning LNG facilities, power installations and natural gas pipelines across the US.
