Blackstone, GSO invest in pipeline company

Blackstone Group L.P. and GSO Capital Partners have purchased a $500 million stake in a new pipeline company run by industry veteran Bob Phillips.

The investment in Crestwood Midstream Partners LLC represents the first time Blackstone has entered into a deal with GSO, a hedge fund it acquired last year. Investment firm Kayne Anderson and Crestwood Management LLC also participated in the funding.

Phillips, who previously ran pipeline companies Enterprise Product Partners LP and GulfTerra Energy Partners LP, said he will use the fresh capital to make acquisitions. Crestwood Midstream plans to target midstream assets and businesses in North America.

"We view Blackstone and GSO as extremely knowledgeable energy investors which, along with Kayne Anderson, provide Crestwood the financial support and industry credibility to become a significant midstream company," Phillips said in a statement.

The size of Blackstone and GSO's stake was not released.

Blackstone and Warburg Pincus last week announced $500 million in funding into oil exploration company Kosmos Energy. Both financial firms had previously committed $300 million to Dallas-based Kosmos.