Deals

Canada Pension Plan bids high for A$7.3bn Macquarie fund

The Canadian investor has bid two-thirds over the share price to gain control of Macquarie Communications Infrastructure Group, which has a debt burden of more than A$5bn

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The Canada Pension Plan Investment Board (CPPIB) has bid over 60 percent above the current share price for a Macquarie-run infrastructure fund that has suffered consistently low valuations.

CPPIB offered A$1.37 billion (€710 million; $930 million) in cash for Sydney-listed Macquarie Communications Infrastructure Group (MGC), a 67 percent premium on the share price.

Nonetheless, CPPIB still described the valuation as “attractive”, saying the acquisition would give it a diversified portfolio of radio and television transmission assets with strong cash flows.

Macquarie is expected to accept the bid after an advisory committee unanimously endorsed the deal. The fund has been trying to boost its share value without success for some time, the firm said.

Macquarie says the fund’s enterprise value is $7.3 billion, includes net debt of A$5.3 billion and exchangeable bonds of A$570 million.