CDPQ grows Latin American footprint with Colombian partnership

The Canadian pension will invest up to $510m alongside a new $490m fund launched by Colombia’s development agency and the country’s pension funds.

Canadian pension manager CDPQ has partnered with the Colombian government to invest up to $1 billion in the Latin American country’s infrastructure.

According to a statement, CDPQ will invest up to $510 million alongside a new $490 million fund launched by Colombia’s infrastructure development agency, Financiera de Desarrollo Nacional, and the country’s pension funds, which include Colfondos, Old Mutual, Porvenir and Protección. FDN will contribute 20 percent of the $490 million and will manage the vehicle through a newly established subsidiary – Infraestructura Asset Management Colombia – while the Colombian pension funds will contribute the remaining 80 percent.

The co-investment platform will make investments of at least $50 million in Colombian infrastructure companies, assets or new developments. Sectors it will focus on include energy and renewables, transportation, social infrastructure, telecommunications, water and waste management.

FDN is Colombia’s national development finance agency focused on infrastructure, which counts among its shareholders the International Finance Corporation, Mitsui Banking Corporation and the CAF Development Bank of Latin America.

CDPQ, one of Canada’s largest pension managers with C$308.3 billion ($232.2 billion; €204 billion) in net assets as at 30 June, has in recent years looked to build out its infrastructure portfolio in Latin America, focusing on Mexico, Brazil and Colombia.

In 2015, the firm launched a similar platform in Mexico, partnering with a group of Mexican pension funds to launch CKD Infraestructura Mexico, with $2.8 billion in combined commitments.

Earlier this year, in January, CDPQ agreed to a $250 million loan to Colombian energy company Empresas Publicas de Medellin, as part of a larger $1 billion facility to back a 2.4GW hydroelectric project. In June, the firm announced it would open an office in São Paulo, Brazil.

CDPQ’s infrastructure portfolio currently stands at C$16.2 billion, accounting for 5.3 percent of its total AUM.