Brookfield Infrastructure pointed to key investments in energy assets and data centres during its third-quarter earnings call as a hint to where the company is most likely to deploy capital in the coming decade.
Sam Pollock, chief executive of the listed infrastructure subsidiary of Brookfield Asset Management, said it will be “an even battle” between the energy and telecommunications sector as to where the company deploys capital over the next five years, but over the next decade, it will “more than likely be data”.
On the earnings call, Pollock said the $1.3 billion sale of Chilean transmission company Transelec to China Southern Power Grid International, which closed in May, allowed Brookfield to go on a spending spree this year, amounting to $1.8 billion in commitments. Most investments the firm announced this year were in the two sectors Pollock said would comprise an increasing share of Brookfield’s portfolio.
In October, the fund manager announced the closing of a $600 million investment in North American residential energy company Enercare, which installs boiler systems in homes throughout Ontario and draws revenue from long-term maintenance contracts.
The company reported completing the first part of a $3.3 billion acquisition for midstream assets in Western Canada that it purchased from Enbridge. Brookfield has invested $525 million of equity for the first part of the deal, which gave the company control of a portfolio of provincially regulated assets. It expects to acquire the remaining portfolio, comprising federally regulated assets, by next year.
As of 30 September, Brookfield managed $75 billion of assets.
Pollock also noted the firm’s recently announced $750 million investment in Brazilian data centre company Ascenty. Brookfield, which invested $200 million along with its institutional partners’ commitment, formed a joint venture with global data centre provider Digital Realty to take co-ownership of a portfolio of eight data centres located in São Paulo, Campinas, Rio de Janeiro and Fortaleza.
“We like this business because it gives us access to markets in South America that are at the early stages of cloud computing, and thus we expect tremendous growth in the business,” Pollock said.
Brookfield made its first data centre investment in June, acquiring a portfolio of 31 assets in North America from AT&T for $1.1 billion.