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Canadian Public Investors Have Big Week in Energy Infrastructure

On January 31, the Canada Pension Plan Investment Board (CPPIB) acquired a 10.4% stake in Transportadora de Gas del Perú S.A. (TgP) from Graña y Montero for US$ 200 million. Graña y Montero is the biggest engineering and construction company in Peru. Graña y Montero also sold a 0.91% interest to Corporación Financiera de Inversiones for US$ 17.3 million. After both deals, Graña y Montero will hold a 1.64% equity stake in TgP. In November 2013, Graña y Montero bought the 12.38% stake in TgP from Argentina-based Pluspetrol Resource Corporation.

In addition, Spanish energy giant Repsol SA sold their 10% stake in TgP to Madrid-based Enagás SA for around US$ 219 million. Enagás SA also entered into a deal to acquire U.S.-based Hunt Oil’s stake in TgP for nearly US$ 272 million.

TgP is the largest mover of natural gas and natural gas liquids in Peru. In fact, in 2012, the asset delivered nearly 95% of Peru’s total volume of natural gas from Blocks 88 and 56 of the Camisea gas fields. Located in the Peruvian Amazon, the Camisea gas fields are near the Urubamba River. Natural gas extraction in the area isn’t without controversy as the gas fields are near the Nahua-Nanti Reserve.

The CPPIB is keen on Latin American energy infrastructure. TgP’s clients include the largest power generators, natural gas distributors and industrial firms in Peru.

Borealis Infrastructure Acquires Interest in Bruce Power B

On the same day as CPPIB’s stake investment in TgP, Borealis Infrastructure, the infrastructure arm of OMERS, signed a deal to acquire 31.6% of Bruce Power B for $450 million from Cameco Corporation, a Uranium miner. Bruce B operates 4 of 8 reactors in the world’s large nuclear generating facility in Tiverton, Ontario – generating 30% of Ontario’s 2013 electricity. Borealis’ ownership in Bruce Power B post-deal rises to 56.1%. Other investors in Bruce Power include: TransCanada Corporation, the Power Workers’ Union and the Society of Energy Professionals. Canada’s largest public-private partnership is Bruce Power – the assets remained owned by the government of Ontario.

Michael Rolland, president and CEO of Borealis, commented in a press release, “Bruce Power is an investment that continues to fit with our long-term strategy to invest in core, large-scale and high-quality infrastructure assets. It also plays a critical role in meeting the supply needs of the province of Ontario.”

CIBC World Markets Inc. acted as a financial advisor to Cameco Corporation.

Asian Sovereign Funds Not Slowing Down on Tech Investing

According to data from SWFI’s Sovereign Wealth Fund Transaction Database, Asian sovereign funds invested US$ 6.05 billion directly into companies and assets in the information technology sector from Jan 2017 to November 22, 2017. In a comparable time frame from Jan 2016 to November 22, 2016, this same group of Asian sovereign funds directly invested US$ 5.02 billion in the sector. These are direct investments, not fund commitments or manager allocations.

Asian sovereign funds such as GIC Private Limited, Temasek Holdings and the Korea Investment Corporation (KIC) have demonstrated bullish signals to the technology community over other sectors. GIC and Temasek have also been major investors in the private side of deals, funding a wide range of tech startups, while providing financial firepower in buyout transactions.

Some notable direct tech investments in 2017 by sovereign funds include Meituan-Dianping, SoundCloud, Nets A/S, Visma AS, Turn, Inc. and Vantiv.

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Future Fund Makes a Guardian Out of Former J.P. Morgan ANZ Chair

The Australian government has appointed Robert Priestley – current non-executive chair of J.P Morgan for Australia and New Zealand (ANZ) and a non-executive director of ASX – to serve on the Future Fund Board of Guardians for a five-year term from November 7, 2017. Priestley replaces former Morgan Stanley Australia chief executive Steven J. Harker.

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Associated British Ports Reboots Property Development Arm to Capitalize on Land Bank

Associated British Ports (ABP) – operator of 21 major ports throughout the United Kingdom – has announced a reboot of its ABP Property division, complete with a new team of specialists in commercial development and logistics led by Huw Turner, in order to identify and develop strategically significant locations in its 2,372 acre land bank.

ABP is owned in large part by a consortium of pensions and sovereign funds, including the Canada Pension Plan Investment Board (CPPIB) at 33.88% ownership, OMERS at 30%, Singapore’s GIC Ventures Pte Ltd at 20.00% ownership, and the Kuwait Investment Authority at 10.00% ownership. Large institutional investors such as sovereign funds, pensions, and endowments have slowly increased allocation towards infrastructure over the past six years as an alternative to equities and bonds, according to asset allocation data from SWFI.

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