Goldman Sachs MLP and Energy Renaissance Fund Close Credit Line
Goldman Sachs MLP and Energy Renaissance Fund (GSAM) announced closing of its $670 million committed line of credit with two major U.S. financial institutions. The Fund completed its initial public offering on September 25, 2014, raising $1.4 billion of equity, excluding any exercise of the underwriters’ option to purchase additional shares. The facility allows the Fund to deploy leverage while taking advantage of the current short-term rate environment.
The Fund will invest primarily in Master Limited Partnerships and other energy investments. The Fund currently expects to concentrate its investments in the energy sector, with an emphasis on midstream MLP investments. The Fund invests across the energy value chain, including upstream, midstream and downstream investments. The Fund seeks a high level of total return with an emphasis on current distributions to shareholders. There can be no assurance that the Fund will achieve its investment objective or that the Fund’s investment program will be successful.
“We believe this is the right time to invest in MLPs as the US energy sector is going through a multi-year growth cycle,” said Kyri Loupis, managing director of GSAM and lead portfolio manager for the Fund. “GER is well positioned to capitalize on the broader North American energy theme by providing investors exposure across the entire energy value chain, with a bias towards midstream assets.”
The Fund is managed by GSAM’s Energy & Infrastructure Team, which is among the industry’s largest MLP investment groups. As of September 30, 2014 the team managed approximately $14.9 billion in MLPs and other energy investments.1
The Fund raised $1.4 billion in its common share offering, excluding any exercise of the underwriters’ option to purchase additional shares. On October 10, 2014, the underwriters partially exercised their option to purchase an additional 4,250,000 shares, resulting in approximately $81 million of additional assets to the Fund. If the underwriters exercise their option to purchase additional shares in full, the Fund will raise $1.61 billion. Underwriters may exercise their option to purchase additional shares up to 45 days after the initial public offering.
GSAM is the asset management arm of The Goldman Sachs Group, which supervises $1.15 trillion as of September 30, 2014.