Brookfield, GIP clear hurdles for Asciano

With the competition commission and the Supreme Court granting their approval, the $7bn transaction is expected to close next month, putting an end to a year-long battle for the acquisition of one of Australia’s largest port operators.

A joint bid by two consortia to acquire Asciano, one of Australia’s largest freight logistics businesses, has succeeded in overcoming concerns raised by Australian regulators, which after much back and forth have cleared the way for the A$9.05 billion ($6.8 billion; €6.1 billion) deal to complete on 19 August.

“The Supreme Court of New South Wales has today made orders approving the proposed Scheme of Arrangement under which Australian Logistics Acquisition Investments will acquire the Asciano shares held by all Asciano shareholders,” the Australian company said in a statement on Thursday.

The Court’s decision comes one week after the Australian Competition and Consumer Commission (ACCC) said it “would not oppose” the proposed acquisition, for which it had raised numerous concerns since Toronto-based Brookfield Infrastructure first announced its plans to buy the Australian company last July.

Since then, the Brookfield-led consortium – which now comprises the British Columbia Investment Management Corporation, Singapore’s sovereign wealth fund GIC and the Qatar Investment Authority – has teamed up with a group led by Qube Holdings, another Australian port and logistics company, against which it was initially competing for Asciano. The Qube-led team includes Global Infrastructure Partners, Canada Pension Plan Investment Board and China’s CIC Capital.

“The ACCC conducted extensive inquiries with a large number of industry participants,” the commission’s chairman Rod Sims said in a statement. “A broad range of issues were raised across different aspects of the supply chain. After careful consideration, the ACCC has concluded there is not likely to be a substantial lessening of competition in any market.”

The latest concern the ACCC had raised in May related to Asciano’s ports business, specifically the vertical integration of Patrick container terminals with Qube and Australian Container Freight Services (ACFS), the two largest landside import-export container logistics providers in the country. ACFS and Patrick Terminals formed a 50/50 joint venture in April 2015.

To address the ACCC’s concerns, Asciano transferred its interest in the ACFS joint venture to a third party, so that Patrick container terminals would be vertically linked only with Qube.

“This restructure resolved a number of the ACCC’s concerns,” Sims said.

Asciano shareholders approved the revised scheme in June.

The go-ahead to proceed with the acquisition comes just two weeks after Brookfield held a final close on its latest infrastructure vehicle, Brookfield Infrastructure Fund III, reaching its $14 billion hard-cap to become the largest infrastructure fund ever raised. GIP is also on the fundraising trail, targeting $12.5 billion for GIP III, a vehicle whose hard-cap has been set at $15 billion.

Brookfield and GIP declined to comment.