GIP reportedly pulls out of TPG-led consortium in Asciano bid(5)

Global Infrastructure Partners is reportedly interested in parts of the Australian transport infrastructure company’s business, while the consortium is interested in acquiring the entire business.

Global Infrastructure Partners (GIP) has left a TPG-led consortium, which intends to bid for Asciano Group, Australia’s largest private port and freight railroad operator, according to the Australian Financial Review.

Global Infrastructure Partners and Asciano did not respond to requests for comment at press time. TPG declined to comment.

GIP may reportedly launch an independent bid for Asciano, which aims to announce a transaction by the end of June. The company has received a range of proposals from a number of parties, it said in a statement two weeks earlier.

The consortium of five including TPG is looking to bid for the entire company, according to a source close to the firm. GIP, on the other hand, is interested in different parts of the business, said the paper. 

Asciano is looking to sell off assets, including 100 percent of its coal transport and container ports units, and possibly the entire business, the company said in March.

In August 2008, Asciano turned down TPG’s and GIP’s bid to acquire the company for A$4.40 per share, saying their offer was too low and “undervalued the business”. The bid valued the company at A$2.9 billion.

Asciano has been forced to consider asset sales and begin negotiations with its bankers to review working capital facilities due to a A$5.3 billion debt as well as declining demand for its services following the economic slowdown.

The company was listed on Sydney Stock Exchange in June 2007 as a spin-off of former parent Toll Holdings’ rail and port operations. Asciano owns Pacific National rail operations and Patrick ports. The two businesses provide a wide range of transportation services such as bulk haulage for coal, grain and industrial products and the operation of container terminals in four Australian ports.

GIP is a joint venture between AIG’s subsidiary AIG Financial Products, Credit Suisse and GE Infrastructure. The firm closed its first infrastructure fund on $5.64 billion (€3.62 billion) in May 2008.

TPG, the largest private equity firm globally according to PEI 300, recently gave its LPs in TPG Asia V the option to cut commitments by up to 10 percent, or a total of $420 million. The fund closed on $4.25 billion in 2008.