AMP Capital increases stake in Victorian desalination PPP

The Australian funds manager ups its total share in the project to 16.5 percent in a deal worth approximately $72m.

AMP Capital has increased its stake in the Victorian Desalination Project PPP through its Community Infrastructure Fund.

The Sydney-based funds manager acquired a 6.8 percent stake in AquaSure, the entity that owns and operates the desalination plant, from Infrastructure Australia LLP, taking its total stake in the PPP to 16.5 percent.

The purchase price for the latest stake was approximately A$100 million ($72 million; €63 million), Infrastructure Investor understands. AMP Capital did not disclose the purchase price and declined to comment on any other terms of the deal, including information regarding the seller, for which no information seems to be available.

The acquisition follows previous purchases of a 5.2 percent stake in September 2016 and a 4.55 percent stake in December 2017.

Billed as the largest desalination plant in the Southern Hemisphere, the Victorian Desalination Project is located near Wonthaggi, 132 kilometres south-east of Melbourne. It opened in 2012 and can supply 150 gigalitres of drinking water per year, equivalent to approximately one-third of Melbourne’s annual water consumption.

Community Infrastructure Fund manager Charles Savage said in a statement: “The Victorian Desalination Plant is known for its world-class design and sustainable practices. The acquisition increases the fund’s exposure to the water sector and sits alongside existing water assets.”

AMP Capital’s Community Infrastructure Fund has 13 assets with a net asset value of more than A$760 million. The fund invests in high-yield brownfield social infrastructure PPP assets in Australia and New Zealand in sectors including education, health, prisons, community housing and water.

The fund’s other water investments are a stake in the Riverland Water consortium in South Australia and AquaTower, which owns and operates four water treatment plants in Victoria under a build-own-operate-transfer agreement.