Two of Canada’s largest pension funds — the Canada Pension Plan Investment Board and the Ontario Teachers’ Pension Plan — are partnering with an infrastructure company in Mexico to invest in the country’s largest toll road.
The CPPIB and Ontario Teachers’ will jointly invest $1.35 billion dollars in exchange for the CPPIB gaining a 29 per cent ownership interest and Ontario Teachers’ a 20 per cent stake. The remaining 51 per cent will go to the infrastructure company IDEAL.
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Arco Norte, the 223-kilometre toll road bypass, acts as a major corridor for trade by connecting various states of Mexico and surrounds a large perimeter of Mexico City’s northern border.
“Arco Norte represents our first infrastructure investment in Mexico and enables us to invest in an established, modern toll road of significant size,” said Cressida Hogg, managing director and head of infrastructure at CPPIB, in a news release.
“This investment fits well with CPPIB’s strategy to invest in core infrastructure assets with long-term, stable cash flows in key global markets.”
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“This investment provides a strong foundation for continued growth of our infrastructure portfolio in Mexico and the rest of Latin America,” said Andrew Claerhout, senior vice-president, infrastructure and natural resources at Ontario Teachers’.
“Arco Norte is an attractive asset with long-term growth potential that will provide income to pay pensions.”
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