Caisse, Mexican funds to co-invest in infrastructure projects

Canadian pension fund manager Caisse de dépôt et placement du Québec said on Monday it has formed an investment platform with a group of leading Mexican institutional investors to put money into infrastructure opportunities in Mexico.

The new vehicle will invest C$2.8 billion (US$2.1 billion) over the next five years in energy generation and distribution, along with investments in other areas like transportation and public transit, said the Quebec-based pension fund manager.

Caisse said it plans to commit some C$1.43 billion to the fund and retain a 51 percent stake in the investment vehicle. CKD IM will hold the remaining 49 percent.

The current shareholders of CKD IM are Mexican pension fund managers XXI Banorte, SURA, Banamex, Pensionissste and Infrastructure fund Fonadin. These pension fund managers together manage some 62 percent of Mexican pension fund assets, said Caisse.

"When we look around the world, especially in the infrastructure sector, Mexico stands out as an exceptional country to invest in," said Caisse Chief Executive Michael Sabia in a statement.

Caisse has been a major infrastructure investor for over 15 years. Its infrastructure portfolio is currently worth more than C$11 billion and includes investments in the Port of Brisbane, Heathrow Airport, Eurostar and Colonial Pipeline in the United States.

The pension fund manager has stated that it plans to double the size of this portfolio by 2018.

"We believe recent reforms in the energy and infrastructure sectors have opened the possibility of win-win partnerships that will benefit the whole Mexican economy," said Grupo Financiero Banorte CEO Marcos Ramírez Miguel in the joint statement issued by Caisse.

As part of the transaction announced Monday, CKD IM is also acquiring 49 percent of Caisse's equity investment in the ICA OVT venture, which currently owns four toll road concessions in Mexico.