Canadian pension fund CPPIB confirms 45% stake buy in Indonesian toll road firm

Jakarta, Indonesia. Photo: Arga Aditya/unsplash

Canada Pension Plan Investment Board (CPPIB) on Thursday announced its first infrastructure investment in Indonesia with the purchase of a 45 per cent stake in toll road operator PT Lintas Marga Sedaya (LMS).

LMS is the concession holder and operator of the Cikopo-Plimanan (Cipali) toll road. CPPIB did not disclose financial terms of the deal.

Earlier this month, DealStreetAsia had exclusively reported CPPIB’s interest in acquiring a stake in LMS. In a follow-up story, Bloomberg said the deal could be worth around $500 million.

In its statement on Thursday, CPPIB said it will invest in the toll road operator in partnership with PT Baskhara Utama Sedaya (BUS), a wholly owned subsidiary of PT Astra Tol Nusantara (Astra Infra).

CPPIB and BUS will jointly acquire a 55 per cent stake in LMS from PLUS Expressways International Berhad, a subsidiary of UEM Group. UEM is wholly owned by Malaysia’s sovereign wealth fund Khazanah Nasional. The stake sale will mark Khazanah’s complete exit from LMS.

BUS currently owns 45 per cent of LMS and will up its stake to 55 per cent, with CPPIB holding the rest. No financial details of the deal were disclosed.

“As CPPIB’s first infrastructure investment in Indonesia, this deepens the fund’s commitment to the Asia-Pacific region as well as our focus on investments in new markets with attractive return and risk characteristics,” said CPPIB senior managing director and Asia Pacific chief Suyi Kim.

At 117 km, the Cipali toll road is one of the longest operational toll roads in Indonesia and a critical link in the transportation network of the island of Java, as part of the Trans Java Toll Road network. It serves as a thoroughfare within West Java, which is Java’s most populous and fastest growing province.

“Cipali toll road provides CPPIB access to a vital infrastructure development supported by rising motorization rates in one of the most densely populated and economically productive regions in Indonesia,” said CPPIB managing director and infrastructure head Scott Lawrence.

CPPIB’s Infrastructure group is focused on investing in quality, large-scale core opportunities with dependable, like-minded partners. As at June 30, 2019, it had C$33.1 billion ($25 billion) invested in infrastructure assets globally.  

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.