Canada’s Ontario Teachers’ Pension Plan (OTPP), a $118 billion pension fund, is locked in exclusive negotiations with Australia’s Leighton Holdings to buy a majority stake in Leighton’s telecommunications (telecom) assets, the Australian firm announced today.
The assets in question include Nextgen Networks – which operates a 17,000-kilometre fibre optic network across Australia – as well as Metronode and Infoplex – two data businesses. Leighton said the assets are valued at A$885 million (€682 million; $913 million) and that OTPP is planning to buy a 70 percent stake in them – which would amount to a A$619.5 million investment, using Leighton’s valuation.
Leighton would retain the remaining 30 percent and continue operating the assets.
“The sale price represents a compelling value creation proposition for Leighton Holdings’ shareholders,” Hamish Tyrwhitt, Leighton chief executive, said in a statement. He added the company – which is owned by Spanish developer ACS – is selling non-core assets to help reduce its debt.
In an interview published in the February 2013 edition of Infrastructure Investor magazine, Stephen Dowd, vice-president for infrastructure at OTPP, said the plan was keen on investing in countries with a “clear regulatory regime”, citing Australia and Chile as good examples. OTPP owns stakes in the Sydney Desalination Plant and in electricity and water and wastewater assets in Chile.
OTPP is a leading direct investor with a C$8.7 billion (€6.45 billion; $8.65 billion) infrastructure portfolio encompassing energy, transportation, and water and wastewater management.
*To read the full interview with Stephen Dowd, please click here.