La Caisse teams up with Plenary to go direct Down Under

The Canadian pension has partnered with the Australian developer and will invest A$139m across five operational public-private partnership projects held by Plenary in Australia. The deal is La Caisse’s first direct investment in Australia, but future joint investments are on the cards.

The Caisse de dépôt et placement du Québec (La Caisse), a Canadian pension fund, has made its first direct investments in Australia via a strategic partnership with Australia- and Canada-focused developer Plenary Group.

The deal will see La Caisse invest A$139.2 million (€112 million; $149 million) in five operational public-private partnerships (PPPs) held by Plenary in Australia. The projects are all social accommodation PPPs, such as the A$1.4 billion Melbourne Convention Centre.

“Through this partnership with Plenary, La Caisse is investing directly in Australia for the very first time,” said Macky Tall, senior vice-president for investments in infrastructure at La Caisse. “Our two organisations share a single vision, that is, to invest in projects presenting predictable long-term returns. Australia is full of interesting projects and we are pleased to be making an initial foray with this local partner,” he added.

But the partnership is not just limited to the five PPPs La Caisse has invested in. “Beyond this initial investment, Plenary and La Caisse have entered into an alliance to consider co-investing in future social infrastructure projects originated by Plenary, creating significant opportunities in the Australian PPP market for both parties,” highlighted Paul Oppenheim, Plenary Group Australia managing director. In fact, a sixth joint investment is already on the cards for later this year.

La Caisse is not the first Canadian pension to set its sights Down Under. Canada Pension Plan Investment Board (CPPIB) chief executive David Denison recently lauded Australian infrastructure as a “highly attractive” asset class? and pledged to increase the Canadian pension’s investments in the country. Denison added CPPIB has invested half of its circa $10 billion Asia-Pacific allocation in Australia.

Similarly, La Caisse is also not the first pension fund to have courted Plenary. Palisade Investment Partners, which represents several Australian superannuation funds, also entered into a similar arrangement with Plenary last year.

La Caisse is one of Canada’s largest pension providers with close to $152 billion of net assets as at December 31, 2010. Plenary, for its part, targets PPP projects in Canada and Australia. Its portfolio of PPPs across the latter has a project capitalisation of over A$5 billion.