CDPQ acquires Plenary’s North America business and PPP portfolio

Plenary Americas’ senior management will retain a minority equity stake in the business, while CDPQ will take a near-90% interest in the PPP portfolio.

Caisse de dépôt et placement du Québec has acquired Plenary’s North American operating business alongside a controlling stake in its portfolio of public-private partnerships.

The business will continue to operate as Plenary Americas under the Plenary Group banner, with the C$340.1 billion ($244 billion; €218 billion) pension purchasing the operating business stake from Plenary Group’s principals in North America, Australia and Asia.

Paul Oppenheim, director and co-founder of Plenary Asia-Pacific, told Infrastructure Investor that Plenary Americas’ senior management team would retain a minority equity stake in the business alongside CDPQ.

The deal also sees CDPQ take a controlling stake in Plenary Americas’ portfolio of PPP assets, with Plenary and its founders retaining a 10.1 percent stake.

Plenary Group and CDPQ declined to disclose the value of the deal.

Oppenheim said that the deal would unlock capital to allow Plenary Asia-Pacific to pursue further opportunities in its home region.

“We feel there are some fantastic opportunities, particularly on the eastern seaboard here in Australia and in Asia as well, and the immediate pipeline that we’ve got ahead of us over the next 18 months to two years is pretty significant,” he said.

“We want to make sure we’re well capitalised to take advantage of those opportunities that are coming up across Victoria and New South Wales in particular, but also further afield.”

He expressed confidence in the pipeline of PPP assets in Australia.

“PPPs obviously do wax and wane a little bit with different governments, and in different sectors at different times. But overall, there’s still pretty strong recognition around the value for money they bring over the long term,” Oppenheim said.

“We’ve got five projects currently being tended in Victoria and we’re hoping that at least one of the next wave of metro projects in Sydney will go down a form of PPP. People worry about [the pipeline] and in my experience there are always enough [projects]. They’ve just got such a good track record now in Australia of delivering outcomes, that it’s hard to see it ceasing altogether.”

Oppenheim added that the sale to CDPQ was a “long-term strategic decision” that had been in the making for some time, unrelated to the recent covid-19 outbreak or market uncertainty.

CDPQ will retain the 20 percent stake in Plenary Asia-Pacific that it acquired in 2016.

Both firms emphasised that the two businesses would continue to work together under the Plenary Group banner and could explore new opportunities together.

Plenary Group owns stakes in a portfolio of 56 assets across Australia, Canada and the US worth more than A$42 billion ($26 billion; €24 billion). Plenary Americas manages 36 of those assets.

In a statement, CDPQ executive vice-president and head of infrastructure Emmanuel Jaclot said: “Plenary Americas is recognised for its highly skilled project development team and solid operational expertise. It is well positioned to act on growth opportunities, notably in the US, where infrastructure needs are rising and long-term investors, such as CDPQ, can play a role in bridging the funding gap. For CDPQ, it is an opportunity to strengthen our presence in social infrastructure and create a powerful platform to develop assets that are at the heart of communities.”