The pair have bought all eight of the assets held by the €1.1 billion AXA Infrastructure Fund II, a vehicle launched in 2006 before Ardian had spun out of AXA. Both APG and AXA were existing investors in the fund.
The acquired assets comprise stakes in Italian gas distribution company 2i Rete Gas, French high-speed railway Lisea, Spanish toll road Trados M-45, French rail GSM communications’ network Synerail, French renewable energy group Kallista Energy, Italian renewables company 3 New & Partners, French toll road A88 and Italian hospital HISI Legnano.
Ardian will retain either an asset management or advisory role at each of the companies and projects. It began the process of divesting the fund last year, a move which involved several bidding rounds.
“A transaction of this magnitude is unique,” Mathias Burghardt, head of infrastructure at Ardian, told Infrastructure Investor. “We’re talking over €1 billion in equity but over €10 billion in asset value. We thought it was easier to maximise price by selling the full portfolio. This portfolio has been [delivering] over 10 percent yield per annum and there was value to keep it all together.”
The fund had originally been targeting an average yield of between 5 percent and 7 percent and a 12 percent to 15 percent gross IRR, documents from AXA disclose.
The deal is not the first time APG has opted to purchase an entire portfolio. The Dutch pension fund manager bought all 48 assets in the DIF Infrastructure II fund in July, following its acquisition of DIF PPP in 2014. APG also backed 3i’s buyout of the EISER Global Infrastructure Fund at the end of last year.
“We’ve seen some previous asset-by-asset deals but I think this is the first time a portfolio of this magnitude was sold through a competitive process,” Burghardt added. “I think it’s quite an interesting transaction in the evolution of infrastructure.”
The deal is expected to close in the first few months of next year.