Goldman, Infracapital looking to sell ABP stake

A third of the UK’s largest port operator, which the two investors bought alongside Borealis and GIC for £2.8bn in 2006, is now on the block.

Goldman Sachs Infrastructure Partners (GS Infrastructure) and Infracapital have begun a process to sell their 33.3 percent stake in Associated British Ports (ABP), the UK’s largest port operator.

A consortium led by the US bank’s infrastructure unit bought the company for £2.8 billion (€3.5 billion; $4.5 billion) in 2006, trumping a rival bid from Australia’s Macquarie Group. GS Infrastructure acquired its one-third stake in ABP jointly with London-based Infracapital, the infrastructure investment arm of UK asset manager M&G.

Admirals Acquisition, the winning consortium, also included Singapore’s Government Investment Corporation (GIC) and Borealis Infrastructure, the infrastructure unit of Canadian pension Ontario Municipal Employees Retirement System (OMERS). Both own one third of ABP each.

With roots dating back to 1962, ABP owns and operate 21 ports in England, Scotland and Wales. Many of them are relatively small, but the portfolio also includes the ports of Southampton and Immingham, the latter of which – thanks to a massive coal import terminal – is the UK’s largest in terms of tons shifted. ABP as a whole handles approximately a quarter of the UK's seaborne trade, according to its website.

The company earlier this month confirmed in a statement that “a decision on the sale will be made pending the conclusion of the process”, with bondholders to be informed of the outcome in due course. It noted that there was no certainty that the transaction would proceed.

Interested parties reportedly include Malaysia’s Employees Providend Fund (EPF), the country’s biggest state-run pension, which is said to be considering bidding as part of a deal that could reach £2 billion. The institution is already exposed to UK real estate through investments in Arena Unit Trust, which owns three Tesco-anchored retail parks, and London’s Battersea Power Station.

Infracapital yesterday announced the final closing of its Infracapital Partners II fund on more than £1 billion, with co-investment pledges taking the total to £1.3 billion. The vehicle, which targets core infrastructure assets across Europe, is already 37 percent invested.