How an investment backwater evolved into a $1 trillion asset class

financialpost.com:

The turbulent years that followed the global financial crisis were not an ideal time for Michael Dorrell and Trent Vichie to be seeding a new infrastructure fund.

Potential investors were reluctant to back new funds and they had little appetite for deals that offered less lucrative returns than large buyouts. At many points, it seemed the end was nigh for their nascent venture.

A dozen years later Stonepeak, the New York-based infrastructure-dedicated investment group they created, is a colossus in the private investment world, with US$60 billion under management.

Companies it controls transport about 10 per cent of the world’s seaborne natural gas, own over 120,000 kilometres of fibre networks and produce enough renewable electricity to power 200,000 households.

The group recently drew a US$2 billion investment from a minority investor that valued it at nearly US$15 billion, according to people briefed on the matter. Dorrell, the Australian-born dealmaker who fought to keep Stonepeak alive in its early days as its chief executive, is now a billionaire.

Stonepeak’s speedy rise has surprised many on Wall Street, but it is a story shared by a small circle of dealmakers who entered infrastructure investment in the United States in the early 2000s.

Adebayo Ogunlesi, for example, who in his days as a top Credit Suisse banker often sat opposite Dorrell and Vichie during negotiations, created Global Infrastructure Partners with the support of the Swiss bank in 2006.

After building up a portfolio of over US$100 billion, this year Ogunlesi agreed to sell to BlackRock for US$12.5 billion in a cash-and-shares deal that will make him and his partners the second-largest shareholders of the world’s largest asset manager.

In the early