The Alberta Investment Management Corp. and the Canada Pension Plan Investment Board are reinvesting in a telecommunications infrastructure provider to support its acquisition of a U.S. digital network provider.
BAI Communications Inc., a Toronto-based internet and telephone network service provider, is acquiring ZenFi Networks Inc, a New York-based digital infrastructure provider specializing in roaming services and fibre connectivity. The acquisition is part of a strategy to grow the BAI’s 5G infrastructure business throughout North America by improving the company’s technical capabilities and service offerings.
The CPPIB, which holds an 86 per cent stake in the business, and the AIMCo, which holds a 14 per cent stake, said they’ll expand a pre-existing $2.4 billion capital contribution to support the acquisition. The initial agreement was made in June to support BAI’s acquisition of two other businesses.
In a press release, Scott Lawrence, managing director and head of infrastructure at the CPPIB, said demand for digital infrastructure was being driven by increasing consumer demand across the globe. “As a leading provider in the space, BAI is very well placed to capture these market opportunities and we believe our increased financial commitment to BAI will continue to generate long-term and sustainable returns on behalf of the CPP’s contributors and beneficiaries,”
Ben Hawkins, head of infrastructure, renewables and sustainable investing at the AIMCo, added demand in the U.S. appeared to be increasing faster than in other regions. “This latest transaction is the realization of BAI’s management team positioning the company for sustainable growth.”
In other news, the CPPIB is reinvesting in a U.K. shopping mall.
Under the terms of a deal reached with Nuveen Real Estate Inc., the organization’s stake in Bullring Shopping Centre in Birmingham, England, which it’s held since 2013, will grow from 16.7 per cent to 50 per cent. Following the acquisition, the CPPIB’s total exposure to Bullring will be about £280 million.
“We are confident that this additional investment into a best-in-class shopping centre, situated in central Birmingham, a strong and growing city, will deliver strong risk-adjusted returns for our contributors and beneficiaries,” said Thomas Jackson, managing director and head of U.K. real estate at the CPPIB, in a press release.