FS Investments and Eig Global Energy Partners have announced a strategic joint venture, poised to create a dynamic platform for energy and infrastructure financing solutions. This collaboration brings together FS Investments, a prominent alternative investment manager, and EIG Global Energy Partners, a leading global firm specializing in energy sector investments. The partnership aims to leverage the strengths of both firms to offer flexible capital solutions across the energy industry and enhance returns for investors, particularly within the FS Energy and Power Fund (FSEP).
This joint venture is structured to combine scale, agility, and deep-seated energy industry expertise. By integrating these elements, the newly formed entity anticipates an enhanced deal flow, with a focus on directly originated deals. This strategic approach is designed to position the portfolio for long-term value creation for FSEP investors, marking a significant development for those invested in energy and power sectors.
Michael Forman, Chairman and Chief Executive Officer of FS Investments, emphasized the strategic fit of the partnership. “As a leading provider of institutional capital in the global energy industry, EIG Global Energy Partners is the ideal collaborator to jointly manage FSEP, given their profound sector expertise, extensive global reach, and operational scale,” Forman stated. He further highlighted the forward-looking objectives of the venture, focusing on “enhancing returns, reducing risk, and creating a liquidity event for our investors through a public listing.”
Echoing this sentiment, William Sonneborn, President of EIG Global Energy Partners, expressed enthusiasm about the partnership with FS Investments. “We are excited to join forces with FS Investments to manage FSEP,” Sonneborn commented. “We are honored that following a comprehensive evaluation, FS Investments and the board of FSEP selected EIG Global Energy Partners as their partner. We are confident that as a unified team, we can optimize the existing portfolio and improve returns for FSEP investors.”
According to the terms of the agreement, pending shareholder approval, both FS Investments and EIG Global Energy Partners will provide investment advisory services to FSEP through the joint venture. Furthermore, EIG has applied for a new exemptive relief order, which, if granted, will enable FSEP to co-invest with EIG’s other funds and accounts, potentially broadening investment opportunities and diversification.
The transition process is already underway, with the board of trustees of FSEP having approved the new investment advisory agreement. Shareholder approval for this agreement is expected to be sought starting in January 2018. Until the new advisory agreement with the joint venture is formally in place, EIG will provide non-advisory services to FSEP, ensuring a seamless transition. Concurrently, FS Investments and GSO Capital Partners have agreed to conclude their sub-advisory relationship concerning FS Investments’ sponsored funds. All parties involved, including FS, GSO, and EIG Global Energy Partners, are committed to ensuring a smooth and efficient transfer of advisory responsibilities.
In a separate announcement, FS Investments also revealed a partnership with KKR & Co. L.P. to deliver investment advisory services to several business development companies (BDCs), further expanding their strategic alliances and market presence. Additionally, FS Investments has strengthened its team with the appointment of a seasoned liquid credit portfolio manager for the FS Global Credit Opportunities Fund, indicating a continued focus on diversifying and enhancing their investment offerings.
These developments underscore FS Investments’ ongoing commitment to providing diverse and robust investment solutions. It’s important to note that these announcements do not affect FS Investments’ other funds, including FS Credit Income Fund, FS Credit Real Estate Income Trust, Inc., FS Energy Total Return Fund, and FS MultiStrategy Alternatives Fund, ensuring continuity and focus across their existing portfolio.
About FS Investments
FS Investments is recognized as a leading asset manager dedicated to empowering individuals, financial professionals, and institutions to build stronger portfolios. The firm specializes in providing access to alternative income and growth sources, consistently setting high standards for investor protection, education, and transparency within the asset management industry. Headquartered in Philadelphia, PA, FS Investments operates from multiple locations including New York, NY, Orlando, FL, and Washington, DC. For more detailed information, please visit fsinvestments.com.
About EIG Global Energy Partners
EIG Global Energy Partners is a preeminent global firm specializing in private investments within the energy sector and energy-related infrastructure. As of September 30, 2017, EIG managed $17.0 billion in assets. Since its inception in 1982, EIG has been a leading institutional capital provider to the global energy industry, offering comprehensive financing solutions across the capital structure for companies and projects in oil and gas, midstream, infrastructure, power, and renewables sectors worldwide. EIG has a substantial investment portfolio, exceeding $24 billion across more than 320 investments in 36 countries. EIG’s global presence is anchored by its headquarters in Washington, D.C., and complemented by offices in Houston, London, Sydney, Rio de Janeiro, Hong Kong, and Seoul. Additional details can be found at www.eigpartners.com.
Disclaimer: This article is based on a press release and does not constitute investment advice. For detailed information and disclosures, please refer to the original documents filed with the Securities and Exchange Commission (SEC) and the company websites.
