Saudi Arabia has committed $20 billion to a new investment fund run by Blackstone for US infrastructure projects.
The Saudi investment accounts for about half of the capital that Blackstone wants to raise for the fund.
New York-based Blackstone expects the program to have $40 billion in total equity commitments in a permanent capital vehicle, including $20 billion to be raised from other investors.
The investment firm said in a statement that it expects to invest in more than $100 billion of infrastructure projects, mainly in the US.
Blackstone is managed by President Trump’s long-time friend and advisor Steve Schwarzman, chair of Trump’s Strategic and Policy Forum.
H.E. Yasir Al Rumayyan, Managing Director of the Public Investment Fund of the Kingdom of Saudi Arabia, said: “The Public Investment Fund’s international investment strategy is built upon establishing strong global partnerships and identifying opportunities to maximize sustainable returns for the people of Saudi Arabia. We look forward to partnering with Blackstone, a recognized leader with a strong record of achievement across its extensive infrastructure projects.
“This potential investment reflects our positive views around the ambitious infrastructure initiatives being undertaken in the United States as announced by President Trump, and the strategic opportunity for the Public Investment Fund to achieve long-term returns given historical investment shortfalls.”
Blackstone President Hamilton E. James said: “There is broad agreement that the United States urgently needs to invest in its rapidly aging infrastructure. This will create well-paying American jobs and will lay the foundation for stronger long-term economic growth.
“Blackstone has the talent, scale and experience to be an effective private sector partner in filling the massive infrastructure funding gap. We thank PIF for its strong endorsement of the United States and its vote of confidence in our country and Blackstone in making this investment.”
The commitment comes after a year of discussions between the two institutions, which began in May 2016.