Blackstone insider to lead infra business

The firm has chosen Sean Klimczak, an energy heavyweight in its private equity group, to helm its $40bn infrastructure fundraise.

Blackstone Group senior managing director Sean Klimczak, who over the past decade has worked on the firm's energy investments, will take the lead of its landmark $40 billion infrastructure business, according to sources close to the firm.

On Saturday, Blackstone revealed its plans to launch an infrastructure fund , when Saudi Arabia's Public Investment Fund said it would seed the vehicle with $20 billion, an announcement that coincided with US President Donald Trump's visit to the Kingdom.

Blackstone said it would match Saudi Arabia's commitment with $20 billion of funds raised from other investors in a “permanent-capital vehicle”. Including leverage, Blackstone envisages to back more than $100 billion worth of infrastructure projects, largely in the US.

Klimczak will draw on his experience at Blackstone to help these efforts. Since joining the firm in 2005, he has been instrumental in closing several of Blackstone's energy deals, including the firm's $1.5 billion investment in Cheniere Partners' natural-gas export terminal, greenfield wind projects in Mexico and Germany, and the acquisition – alongside Arclight Capital Partners – of a portfolio of North American power plants.

Klimczak began meeting with Saudi officials in April 2016 about the launch of an infrastructure vehicle that would attract money from the country's Public Investment Fund, sources said. The institution's $20 billion commitment already surpasses what is currently the largest infrastructure fund ever raised, Global Infrastructure Partners III, which closed on $15.8 billion in January.

Blackstone's announcement is the first specific commitment to US infrastructure since Trump stated his $1 trillion spending plans upon taking office in January. The president, who has appointed Blackstone chief executive Steve Schwarzman to chair a business advisory council, has signalled his intent to lean on private investments to partly meet that goal.