Canadian funds in co-investment deal

The trend for co-investment in infrastructure has continued in Canada with two large funds, OTPP and OMERS, partnering to purchase the High Speed 1 (HS1), Britain’s only high-speed rail link to the Channel Tunnel.

The $C96.4 billion ($94.4 billion) OTPP, which began investing infrastructure in 2001 and has $7.7 billion in infrastructure and timberland, has had a history of co-investing in infrastructure projects.

It owns, with Australian fund VFMC, a 48.25 per cent stake in Birmingham International Airport, the sixth largest airport in the UK, serving more than nine million passengers annually.

It also jointly acquired Chilean electricity transmission and distribution company SAESA Group with Morgan Stanley Infrastructure in 2008. And, it was part of a consortium that purchased Scotia Gas Networks, which operates gas distribution networks in Scotland and southern England, in 2005 and hold a 25 per cent stake in the enterprise.

Its infrastructure investments form part of the $44.9 billion invested in inflation-sensitive assets which also includes real estate, real-return bonds and commodities.

Borealis Infrastructure is the infrastructure arm of the $47 billion OMERS, and manages a portfolio of $6.8 billion invested in more than 20 businesses.