Brookfield-led group to acquire 50% of France’s TDF

A group led by Brookfield Infrastructure Partners (BIP), a publicly-listed fund of Brookfield Asset Management (BAM), has agreed to acquire 50 percent of TDF, the largest independent communication tower infrastructure business in France, for an enterprise value of approximately €1.78 billion, the Toronto-based firm said in a statement.

Of the total, BIP is expected to commit $500 million in equity representing a 23 percent stake in the French company. The investment also represents the first made by the Canadian firm in the telecommunications sector and marks the launch of Brookfield Communications, which will complement BIP’s utilities, transport and energy platforms, a spokesperson for the firm told Infrastructure Investor.

The transaction, expected to close in the first quarter of 2015, is subject to regulatory approvals as well as completion of labour consultation customary under French labour law, satisfactory to the seller.

Infrastructure Investor was able to confirm that Dutch pension fund APG is part of the Brookfield-led consortium. According to media reports, the other members are London-based Arcus Infrastructure Partners and Canadian pension fund PSP Investments. However, neither Arcus nor PSP responded to a request for comment at the time of writing.

The remaining 50 percent will be “acquired by other transaction partners,” Brookfield said in the statement.

TDF’s national network comprises more than 6,690 multi-purpose tower and active rooftop sites as well as 5,000 kilometres of fibre backbone. Its major shareholders are US private equity firm TPG Capital (42 percent); state bank Bpifrance (24 percent); Paris-based fund manager Ardian (18 percent); and London-based private equity firm Charterhouse Capital Partners (12 percent).

“TDF represents an exciting opportunity to invest in one of the leading European communication infrastructure operators,” Brookfield Infrastructure chief executive Sam Pollock said. “This is a platform with significant scale, comprising a portfolio of high cash flow generating assets with strong growth potential,” he added.

Cross-listed on the Toronto and New York stock exchanges, BIP owns and operates utilities, transport, and energy assets worldwide. In October 2013, BAM announced that BIF II, Brookfield Infrastructure’s latest offering, had closed on $7 billion, exceeding its initial target by $2 billion and becoming the largest infrastructure investment fund raised in 2013.

In addition to infrastructure, BAM also focuses on property, renewable power, and private equity. It has approximately $200 billion in assets under management.

Photo courtesy of TDF.