Liberty Mutual Investments has established a long-term strategic partnership with Zenith Asset Management to support the launch and growth of the energy infrastructure-focused investment firm and pursue investment opportunities across the sector.
The partnership is also supported by a group of veteran energy industry executives who will invest alongside Liberty Mutual Investments and Zenith.
The three parties plan to collaborate on future investment opportunities sourced through Zenith’s network.
Financial terms of the partnership were not disclosed.
Zenith is focused on investments across the energy infrastructure value chain, targeting essential assets with durable demand characteristics.
Its investment areas include midstream, downstream, power and storage infrastructure.
The company plans to initially focus on opportunities across North America, with the potential to expand into Europe over time.
Zenith’s leadership team includes energy and infrastructure industry veterans Jeff Armstrong, Jay Reynolds, Dean Fezza and Daniel Androphy.
The firm is seeking to combine its executives’ operating experience with long-term investment capital to identify, acquire and manage infrastructure assets.
Zenith believes the energy infrastructure market offers significant investment opportunities following years of underinvestment in assets needed to support the broader economy.
The firm plans to work with sponsors, management teams and asset owners to build and expand critical infrastructure businesses.
Its strategy is centered on investments that management believes are supported by long-term demand rather than shorter-term market cycles.
The partnership gives Zenith access to Liberty Mutual Investments’ scale and long-duration capital as it develops its investment platform.
Liberty Mutual Investments manages and invests more than $130 billion of capital globally on behalf of Liberty Mutual Group.
The investment organization operates across liquid markets, credit and alternative strategies.
Its approach includes forming strategic relationships with experienced operators and investing alongside those partners to build businesses over extended periods.
Liberty Mutual Investments’ Energy & Infrastructure team led the Zenith transaction.
The team targets investments positioned to benefit from structural trends affecting energy and infrastructure markets.
Those themes include increasing electricity demand, growth in data consumption, decarbonization and aging infrastructure.
Rising power requirements are particularly relevant as additional data center development, electrification and broader economic growth increase the need for generation, transmission, storage and other supporting infrastructure.
Zenith’s focus across midstream, downstream, power and storage gives the company the ability to evaluate opportunities across multiple portions of the energy value chain.
Management plans to apply operational experience and capital discipline to assets where it believes additional investment, improved operations or expansion could create long-term value.
The partnership is structured around Liberty Mutual Investments’ long-term investment horizon rather than a traditional short-duration capital model.
Zenith views that structure as important for infrastructure investments, where development, modernization and operational improvements can require significant capital and extended holding periods.
The participation of additional energy industry executives is also intended to broaden the partnership’s industry knowledge, operating experience and ability to identify potential transactions.
Together, Liberty Mutual Investments, Zenith and the executive investor syndicate intend to pursue opportunities emerging from Zenith’s relationships throughout the North American energy infrastructure market.
KEY QUOTES:
“Years of underinvestment have left the energy infrastructure market with a growing gap between the assets the economy needs and the capital available to build them. We founded Zenith to close that gap by investing in essential assets with durable demand and managing them with the operating discipline our team has built over decades in the industry.”
Jeff Armstrong, Co-Founder of Zenith Asset Management
“Finding a partner with truly long-term, flexible capital is rare and LMI shares our belief that real value in this sector is created patiently. Together with LMI and the group of veteran energy executives investing alongside us, we’re well positioned to move decisively on opportunities across our network.”
Jay Reynolds, Co-Founder of Zenith Asset Management
“Jeff, Jay and the Zenith team bring an exceptional operational track record and deep relationships across the sector, which positions them well to source, execute, and manage compelling opportunities across these critical areas of the energy infrastructure market. We look forward to closely partnering with Zenith as they build their platform, bringing our scale and long-term perspective to support the firm as it grows.”
Charley Poole, Head of Energy & Infrastructure at Liberty Mutual Investments