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CDPQ buys two port stakes to anchor $3.7bn DP World JV

The partners will mostly target brownfield ports in emerging and some OECD markets, with the ports of Prince Rupert and Vancouver as their first buys.

CDPQ has launched a $3.7 billion investment vehicle with Dubai-based DP World to build and acquire ports around the world.

The partnership is seeded with the purchase of the Port of Prince Rupert and the Port of Vancouver on Canada's west coast. CDPQ paid $640 million for a 45 percent stake in the assets and will hold that much interest in the overall platform. DP World, which manages 77 ports across six continents, took a 55 percent stake in the ports and the platform.

Macky Tall, a CDPQ vice president and chief executive of CDPQ Infra, told Infrastructure Investor the Canadian pension manager and DP World will invest in brownfield ports in emerging markets and in some OECD countries “over the coming years.” Up to 25 percent of the platform is allotted for greenfield projects, he said.

“In CDPQ,” Sultan Ahmed bin Sulayem said in a statement, “we have found a partner with a shared vision who is willing to participate in the risk and reward of investing throughout the life cycle of trade-enabling assets across the globe. The partial monetisation of our Canadian assets further strengthens our balance sheet”.

Both ports have rail connections and are currently being expanded. The Port of Prince Rupert is almost 59.4 acres and is the fastest North American west coast route to Asia, according to CDPQ. The Port of Vancouver is 72 acres and has rail connections to the US Midwest.

The last time CDPQ made a port investment was in 2013, when it bought a 26.7 percent stake in the Port of Brisbane in Australia.

“We look forward to leveraging our in-house infrastructure expertise and DP World's strong track record in the port sector to deliver attractive long-term returns for our clients,” CDPQ chief executive Michael Sabia said in a statement.