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Asia firms, Canada pension buy Sydney Metro stake for A$167 million

By Asia Asset Management  
December 3, 2019

Four Asian firms have joined forces with Canada’s second largest pension fund to acquire a 24.9% stake in Australia’s Sydney Metro automated transit system from the New South Wales state government for A$167 million (US$113 million).

The investors – Caisse de dépôt et placement du Québec (CDPQ), Hong Kong’s MTR Corporation, Japan’s Marubeni Corporation, and Australia’s Plenary Group and CIMIC Group – will sign a public-private partnership contract for operating and maintaining the transit system, CPDQ says in a statement on November 28.

CDPQ manages pension plans in the Canadian province of Quebec.

“This investment is perfectly aligned with our strategy to invest in high-quality infrastructure assets, alongside partners with a deep understanding of the market and vast operational expertise,” Emmanuel Jaclot, the pension fund’s executive vice-president and head of infrastructure, says in the statement.

According to Mr. Jaclot, the Sydney Metro system will “contribute to the transition toward a low-carbon economy by compounding the benefits of mass transit, electrification and energy from renewable sources”.

The transit system, which began operating in North West Sydney this May, will be extended into the Sydney city centre by 2024.

This is CDPQ’s second investment in Australia since August, when it teamed up with Canadian private equity firm Brookfield Business Partners to invest over A$300 million in hospital operator Healthscope.

The pension fund also acquired a 44% stake in Australian insurance distributor Greenstone for an undisclosed sum in 2016.

CDPQ had C$326.7 billion ($245.8 billion) of net assets as of June 2019.