The Universities Superannuation Scheme Limited, one of the largest pension schemes in the UK, has completed the acquisition of the Brisbane Airtrain. The transaction was arranged by USS Investment Management Limited, USS’s principal investment manager and advisor who will manage the investment on USS’s behalf.
The Universities Superannuation Scheme Limited (“USS”), one of the largest pension schemes in the United Kingdom, today announced that USS Axle Pty Limited (“USS Axle”), a subsidiary of USS, has successfully completed the acquisition of the Brisbane Airtrain.
The transaction was arranged by USS Investment Management Limited (USSIM), USS’s principal investment manager and advisor who will manage the investment on USS’s behalf.
Following a period of exclusivity in December, Airtrain Holdings Limited (“Airtrain”) entered into a binding agreement with USS Axle for the sale of the company for approximately A$110 million in cash on 21 December 2012. The transaction was implemented by way of a scheme of arrangement under which USS Axle has acquired the entire issued share capital of Airtrain Holdings Limited, the parent company of Brisbane Airtrain. CP2 Limited has co-invested 1% of the total consideration and will be retained by USS in an asset management role.
The completion of the transaction follows the satisfaction of a number of conditions precedent including approvals from the Queensland Department of Transport, the Foreign Investment Review Board as well as approval by the requisite majorities of Airtrain Holdings’ shareholders.
USS has made a number of investments in Australia over recent years including the take private of ConnectEast, which operates the EastLink toll road in Melbourne and the Airport Link rail company in Sydney.
Gavin Merchant, Senior Investment Manager Infrastructure at USSIM, commented, “Brisbane Airtrain is a key piece of transport infrastructure that supports the strong growth of Brisbane and South East Queensland. As a Director on the Board I look forward to working closely with the outstanding Airtrain management team, its contractual partners and all stakeholders to continue the high levels of safety and performance and to grow passenger numbers.”
Rob Horsnall, Investment Manager Infrastructure at USSIM, added, “USS’s ability to all equity fund the transaction, without the need for external funding allowed us to agree and execute the acquisition of Brisbane Airtrain quickly and efficiently.”
USS was advised by CP2 Limited and Johnson, Winter & Slattery. Airtrain was advised by Rothschild and King & Wood Mallesons.
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Airtrain Holdings Limited is an unlisted public company that owns the concession until 2036 for the Brisbane Airport Rail Link which consists of an 8.5km elevated railway and two stations at Brisbane Airport’s international and domestic terminals.
Airtrain commenced operations in 2001 and is the sole rail service connecting the Brisbane Airport to the Brisbane CBD, the wider Queensland Rail passenger rail network and the Gold Coast. In the 12 months to 30 June 2012, there were 1.76 million passenger trips on the Airtrain.
USS was established in 1974 as the principal final salary pension scheme for universities and higher education institutions in the UK. It is the 2nd largest UK pension scheme with assets of £36bn as at 31 December 2012.
USSIM is a wholly owned subsidiary of USS and has been appointed as USS’s principal investment manager and advisor. It currently employs 76 investment professionals and has approximately £36 billion of assets under management and advice as of the 31st December 2012.
USSIM has a dedicated Infrastructure team that currently manages approximately £1 billion in infrastructure assets on behalf of USS with a mandate to invest up to 7% of USS’s assets in infrastructure over the medium term.
CP2 is a specialist infrastructure investment manager with offices in Sydney and London. It has over A$2.6 billion of funds under management in core infrastructure assets that provide secure, stable, inflation protected cash flows over the long term.