USS, ATP boost Redexis ownership to 49.9%

The two pensions have increased their stake in Spain’s second-largest gas transportation business, which Goldman Sachs had put on sale last year.

USS and ATP have bought an additional 18.8 percent stake in Redexis Gas, one of Spain’s largest gas transportation and distribution networks, from funds managed by Goldman Sachs Infrastructure Partners.

The transaction boosts the two pensions’ joint ownership to 49.9 percent, comprising 30 percent for USS and 19.9 percent for ATP. Prior to the transaction, the latter owned 16.6 percent of the company, an ATP spokesman told Infrastructure Investor. USS held 16.7 percent. Goldman Sachs will retain the remaining 50.1 percent.

No value was disclosed for the transaction, but Infrastructure Investor understands it was worth more than €400 million. The sale process, through which Goldman Sachs initially intended to sell 100 percent of the business, kicked off in September last year. Local reports say the asset manager was originally angling for a transaction valuing the business at €2.5 billion. It is unclear whether the firm is still looking to sell its remaining stake.

ATP, USS and Goldman Sachs all declined to comment. 

Goldman Sachs created Redexis through buying assets from Spanish utility Endesa in 2010 for about €800 million. USS and ATP became indirect owners in the company then, increasing their holding gradually thereafter to reach a combined 31.1 percent.

Redexis then scaled up through investing about €1 billion in both organic growth initiatives and acquisitions, becoming the country’s second-largest gas transportation business and fourth-largest gas distributor. The investment programme was funded via capital injections from the company’s shareholders, a €160 million grant from the European Fund for Strategic Investments, a €300 million bank loan and bond issuances totalling €900 million.

As of 31 March, Redexis owned a 9,509km gas network, comprising 1,622km of transportation and 7,887km of distribution pipelines, respectively. It posted €212 million of revenues in 2016, up from 112 million in 2010.