Goldman Sachs Asset Management launches first closed-end fund

NEW YORK Tue Nov 26, 2013 4:36pm EST

NEW YORK Nov 26 (Reuters) - Goldman Sachs Asset Management, a unit of Goldman Sachs Group Inc, launched its first-ever closed-end fund on Tuesday, raising $826.3 million from investors.

The Goldman Sachs MLP Income Opportunities Fund trades on the New York Stock Exchange and will invest mainly in master limited partnerships (MLPs), which are publicly traded entities that can own assets such as pipelines, timber or real estate.

MLPs will benefit from record U.S. production of commodities such as crude oil, natural gas, and natural gas liquids over the next few years, said Kyri Loupis, managing director and lead portfolio manager for the fund, in an interview.

Loupis, who runs Goldman Sachs Asset Management's Energy and Infrastructure Team, manages the fund with two other portfolio managers on the team. The team manages about $6.4 billion.

Morgan Stanley, Citigroup, and BofA Merrill Lynch were the lead underwriters in the fund's offering. Goldman Sachs Asset Management oversees more than $208 billion in U.S. mutual funds.

Loupis said MLPs offer growth opportunities that bonds do not, in addition to higher yields. He also said that MLPs will benefit from increased demand from institutional investors and are less sensitive to higher interest rates than other bonds.

Investors anticipate that rates will spike higher once the Federal Reserve begins reducing its $85 billion monthly bond-buying program.

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