While Others Go Home, Canadian Pension Plans Go Big

(November 12, 2009) – Despite trepidation elsewhere, the $115 billion Canadian Pension Plan Investment Board (CPPIB) and the $88 billion Ontario Teachers’ Pension Plan are continuing their habit of direct private equity investments abroad.

On November 5, the two funds joined forces in a CD$6.5 billion hostile bid for Transurban Group, which owns highways in Australia and the United States. While they together own 25% of the company, Transurban’s board rejected the offer, according to Canada’s Globe & Mail. However, the three parties are now in talks.

Also last Thursday, CPPIB and TPG Group made a $4 billion attempt on IMS Health, a Connecticut-based pharmaceutical information provider.

“We are uniquely positioned right now. We are among the few institutions in the world with the capability and the resources to take on complex, large private-equity transactions,” Mark Wiseman, Senior Vice President and Head of Private Equity at CPPIB, is quoted saying in the Globe & Mail.

This is not the first move by the CPPIB in Australia this year. Earlier, the fund paid upward of $1.5 billion for Macquarie’s communication network company, Macquarie Communications Infrastructure Group. “Australia and the U.K. have featured the most attractive infrastructure opportunities for the past two decades….Western Europe and North America rank well behind,” Wiseman told the Globe & Mail.