A pair of top firms have advised as three of the world’s largest alternative asset managers have agreed a $16bn infrastructure partnership with Kuwait Oil Company (KOC).
Blackstone, Brookfield, and KKR have agreed to a joint venture with KOC, with each of the three asset management giants to hold an equal share of a 49% stake in the JV, and KOC to retain the remaining 51%.
Clifford Chance advised the consortium, led by KKR, Blackstone and Brookfield, across M&A, finance, projects and tax matters. The core team was led by private equity partners Jonathan Dillon and Patrick Scott in London and Mo Al-Skukairy in Dubai, and projects partner Chirag Sangharjka, also based in Dubai.
Also on the team were global energy and resources sector cohead Nicholas Hughes, European CLO practice lead Jessica Littlewood, tax partner Ed Page, and finance partner Jemma Dick, all in London, as well as projects partner Craig Nethercott and M&A partner Deniz Tas in Dubai, and projects partner Gianluca Bacchiocchi and tax partner Avrohom Gelber in New York.
Last year, Clifford Chance made hires from both Blackstone and KKR, bringing in Scott, former European counsel at KKR, and Angharad Lewis, who returned to Clifford Chance from Blackstone, where she led its legal function in Europe, after leaving the firm as an associate in 2022.
Scott and Dillon said: ‘We congratulate our clients on the successful signing of this transaction, which demonstrates the depth and breadth of Clifford Chance’s relationships with some of the world’s pre-eminent private capital sponsors.’
KOC is a subsidiary of Kuwait Petroleum Corporation (KPC), the state-owned oil company that oversees Kuwait’s oil and gas sector. In 2017, Clifford Chance advised KPC oil refining subsidiary Kuwait National Petroleum Company (KNPC) on the $6.2bn export credit agency financing of its clean fuels project.
The deal marked the first time that KNPC had tapped international finance markets. The firm’s team was led by Peter Avery – at the time a Dubai-based partner, and since 2020 a consultant at the firm.
Gibson Dunn also advised Brookfield on the deal, with a team including Renad Younes, partner in charge of the firm’s Abu Dhabi office, as well as Abu Dhabi projects partners Samuel Ogunlaja and Laleh Shahabi, and London finance partner Kavita Davis.
The firm has an established relationship with Brookfield, and last week advised the asset manager and the Canada Pension Plan Investment Board on the $5.2bn take-private of US real estate investment trust LXP Industrial Trust.
The new JV between Blackstone, Brookfield, KKR, and KOC will see the newly formed entity lease the usage rights for all KOC’s 13 pipelines – a total of 320km of Kuwait’s pipeline network. The JV will then lease back to KOC the exclusive use, operational and maintenance rights in the pipeline assets for 20.5 years, in exchange for a tariff based on the flow of oil.
The deal is Kuwait’s largest energy infrastructure partnership to date, and the largest ever foreign direct investment in the region. It is part of Kuwait’s long-term plan to diversify its sources of capital and engage more deeply with international investors.
KOC is expected to receive around $7.85bn from the JV upfront upon closing. The state of Kuwait will retain full national ownership and operational control of the pipeline infrastructure leased as part of the deal.
The transaction is governed by Kuwaiti law, and is subject to customary closing conditions and regulatory approvals.
