What was your most significant deal of the year and why?

We recently closed a $700 million convertible preferred equity deal with Western Gas Partners. This deal was one of our most significant as it demonstrated that the midstream industry still has attractive access to capital despite a cyclical downturn in energy. The transaction allowed a highly respected pipeline company to finance the purchase of a large asset from their parent, Anadarko Petroleum, and helped finance their capital expenditures for the next two years, providing a bridge for the company to better navigate the current commodity price environment.

Robert V. Sinnott, 66

Title: Chief Executive

Firm: Kayne Anderson Capital Advisors

Rank: Private equity, No. 4

Years at firm: 24

Residence: Pacific Palisades

How do you stay ahead of the game and get access to deal flow others don’t have?

We have built a strong brand as a niche investor in areas we believe we can develop knowledge and sourcing advantages. There aren’t too many firms that invest in the lower middle market like we do with the resources of a firm that has $20 billion in assets under management. In addition, companies know we will always make good on our commitments and look for solutions and opportunities where both sides win. Over the last 24 years, those attributes have helped us to develop one of the premier reputations in the energy industry, which has led to us being a first call for deals.

How do you choose your partners in the deals you pursue?

We attempt to partner with co-investors that will bring some value-add to the investment process. Often they are other private equity firms in energy.

What trends are you seeing in the sectors in which you specialize?

The single biggest trend in energy investing is that firms are looking to us to provide more than just capital, to be their partners. Advice, flexibility, and fairness are emerging contributions. On the real estate side, strong demographic trends in the niches in which we invest (medical office, senior living, and student housing) and fragmented ownership are allowing us to be an aggregator of middle-market properties at very attractive risk-adjusted returns. Within growth equity, we have capitalized on a trend by entrepreneurs who want outside capital to fund growth but aren’t ready to give up control stakes.

What was your personal highlight over the past year?

The highlight of the year for us was being able to invest in both new and existing strategies, including raising over $3 billion in capital for our energy-investing activities.

For reprint and licensing requests for this article, CLICK HERE.