Blackstone is said to raise $4.5 bn for energy fund

The Blackstone Group has finished raising $4.5 billion for a new fund dedicated to investments in the energy sector, as the private equity giant seeks to profit on the rout in oil prices, a person with knowledge of the matter said on Friday.

The fund, which began soliciting capital last year, exceeded a $4-billion target and hit its "hard cap" for assets raised, reflecting robust demand from investors, said the person, who spoke on the condition of anonymity. The fund is expected to hold its official closing in the coming days.

The Blackstone vehicle is among several efforts by big private equity firms to find investment bargains among oil and gas companies, many of which have been strained by the fall in oil prices since last June. Apollo Global Management is currently seeking to raise a new fund to buy the debt of troubled energy companies. In the fall, the private equity firm Warburg Pincus raised $4 billion for its first fund dedicated to the energy sector.

Blackstone's new fund, called Blackstone Energy Partners II, is significantly larger than the firm's first private equity fund dedicated to energy, which had about $2.5 billion in assets. That fund finished raising capital in 2012.

Stephen A Schwarzman, Blackstone's chief executive, said in December that he was particularly bullish on energy. Private equity firms like Blackstone try to buy assets that are unloved or experiencing financial distress, aiming to fix them up and sell them at a profit.

"I think this is going to be a wonderful, wonderful opportunity for us," Schwarzman said at the time. "It's going to be one of the best opportunities we've had in many, many years."

Peter Rose, a Blackstone spokesman, declined to comment.

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