Sunday, December 13, 2015

Carlyle's Rubenstein Reiterates Energy Attactiveness

Business Insider reported:

The energy sector is about to throw up a once-in-a-lifetime investment opportunity. 

That is according to David Rubenstein, the billionaire cofounder and co-CEO of the alternatives giant Carlyle Group.

"Maybe the greatest energy investing opportunities we've ever seen" lie ahead, Rubenstein said December 9 at the Goldman Sachs Financial Services Conference in New York. 

"Distressed debt is very popular right now."
Distressed debt is the way Carlyle might lose current energy affiliates, like Niska Gas

It's also the way Carlyle might backdoor takeover other struggling energy companies.

The Carlyle Group shifted to a loss in the third quarter, which Rubenstein blamed on a one day stock market drop.  Carlyle's energy sector losses are much deeper than a bad trading day. 

Despite teasing CNBC in March that Carlyle would buy energy, Rubenstein said that is yet to happen.

Carlyle has done a good job of biding its time, and said prices still haven't reached a bottom. West Texas Intermediate crude oil dropped below $37 a barrel on Tuesday.  "We're quite pleased with our willingness to hold back."
Carlyle's $9 billion in energy dry powder in March is now $10 billion. It will be interesting to see when and how that is put to work.