Brookfield Infrastructure Partners (BIP) will invest approximately $490 million in Arteris, the holding vehicle for more than 3,200 kilometres of Brazilian toll roads in which a BIP consortium and Spanish developer Abertis acquired a 60 percent stake last year, BIP said in a statement.
The investment, which is the result of a mandatory tender offer the joint venture was required to make to the shareholders of Arteris’ remaining 40 percent stake, increases BIP’s ownership to about 31 percent.
“In our first year of ownership, Arteris’ performance has exceeded our expectations, with toll revenues increasing by over 10 percent compared with the prior year,” BIP chief executive Sam Pollock said. He also noted that Arteris has invested over BRL500 million (€165.4 million; $219.5 million) to widen its roads which will increase capacity and throughput.
“We see this as an attractive opportunity to invest more capital in assets that we know well, with long-term, risk-adjusted returns within our target range of 12-15 percent,” he said.
Arteris is one of the largest owners and operators of toll road concessions in Brazil. According to BIP, Arteris’ toll road concessions benefit from increases in traffic and rates that are indexed to inflation.
A publicly listed fund of Brookfield Asset Management (BAM), BIP owns and operates utilities, transport, and energy assets worldwide and has $20 billion in capital.
In addition to infrastructure, BAM also focuses on property, renewable power, and private equity. It has more than $175 billion in assets under management.