Canada Pension Bids $3.4 Billion for Intoll Group

(July 15, 2010) — The Canada Pension Plan Investment Board made a $3.4 billion non-binding takeover bid for Macquarie Group Ltd.- backed Intoll Group, a Sydney-based owner of infrastructure assets. The bid marks the board’s second attempt to buy an Australian toll-road operator in eight months.

The offer puts a spotlight on the attractiveness of infrastructure assets, such as toll-roads and airports, that have become targets of investment for the world’s pension funds as a result of their stable, long-term streams of revenue.

“We believe Intolls toll road assets are a good fit with CPPIBs portfolio and long-term investment mandate and are well-situated strategically to benefit from future urban growth in Toronto and Sydney,” Andre Bourbonnais, senior vice president of private investments at the pension fund, said in an emailed statement to Bloomberg.

The bid for Intoll, which is 18% owned by Macquarie Group, spun out of Macquarie Infrastructure Group six months ago, would reach $4.5 billion including debt, the Financial Times reported.

Last year, the Canadian pension fund joined the Ontario Teachers’ Pension Plan and Australia’s sovereign wealth fund The Future Fund to launch a $6 billion takeover for Australia’s biggest toll-road operator, Transurban Group.

The Toronto-based CPPIB invests surplus cash from the national Canada Pension Plan.