Creation of a private capital fund led by FDN and including all Colombian pension funds to co-invest in infrastructure with CDPQ
An infrastructure co-investment platform was officially launched with the President of the Republic of Colombia, Iván Duque, the President and CEO of Caisse de dépôt et placement du Québec (CDPQ), Michael Sabia, and FDN President Clemente del Valle, as well as the presidents of all Colombian pension fund administrators in attendance.
The FDN and Colombian pension fund administrators (AFPs) have created a new private capital fund of USD 490 million. This fund will co-invest with CDPQ through a platform whose objective is to make capital investments in infrastructure projects and companies for a total amount of up to USD 1 billion. CDPQ will contribute up to USD 510 million. The minimum size of each investment will be USD 50 million, split between the fund and CDPQ.
“We are very pleased to invest in Colombia with the private capital fund created by the FDN and pension fund administrators. This partnership combines our partners’ market knowledge with our expertise in infrastructure. We believe that together, we can find the best investment opportunities in a variety of sectors, generate returns for our respective pensioners and at the same time contribute to economic growth in Colombia”, stated Michael Sabia, President and CEO, CDPQ.
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Following significant efforts to raise infrastructure debt financing, the FDN also identified a need for equity investments. This is how it came to spearhead the creation of the private capital fund, the co-investment platform and the partnership with CDPQ, a long-term strategic partner with a vast experience in infrastructure investment in various countries. Through these three initiatives, the FDN will be able to mobilize up to 10 times the invested resources.
“With this private fund, capital will be invested in infrastructure, with the support of all Colombian pension fund administrators, who will be able to make long-term equity investments in projects and companies, hand-in-hand with a professional, highly reputable investor and global leader in infrastructure investment, CDPQ. This is a leap for the country in the field of infrastructure financing”, said FDN President Clemente del Valle.
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The investment processes of the private investment capital fund will be conducted by the administrator, INFRAESTRUCTURA ASSET MANAGEMENT COLOMBIA SAS, a wholly-owned FDN subsidiary.
Investors in the private capital fund will include the FDN, with up to 20% of the total, and the remaining 80% will come from Colfondos, Old Mutual, Porvenir and Protección.
About the FDN
The Financiera de Desarrollo Nacional (national development finance agency – FDN) is a specialized, technical and independent private entity charged with mobilizing the players and resources necessary to successfully develop the country’s infrastructure. Its specialization and knowledge of infrastructure and financing enable it to design solutions with sophisticated and innovative schemes and mechanisms aimed at adequately managing risks, and identifying and attracting other sources to participate in financing schemes. Through its objective of overcoming financing barriers and providing solutions, the FDN promotes efficient financing structures with the aim of obtaining competitive sources of long-term financing and mitigating the risks of refinancing.
The arrival of the IFC, Sumitomo Mitsui Banking Corporation and CAF Development Bank of Latin America as FDN shareholders bolstered the entity’s independence by bringing international best practices and solid corporate governance. These investors also reinforced the FDN’s technical capability by promoting financing of the country’s infrastructure projects and strengthened its financial muscle by mobilizing all of the stakeholders needed to fulfill this mandate.
About CDPQ
Caisse de dépôt et placement du Québec (“CDPQ”) is a long-term institutional investor that manages funds primarily for public and parapublic pension and insurance plans. As at June 30, 2018, it held CAD308.3 billion in net assets. As one of Canada’s leading institutional fund managers, CDPQ invests globally in major financial markets, private equity, infrastructure, real estate and private debt. For more information, visit cdpq.com, follow us on Twitter @LaCDPQ or consult our Facebook or LinkedIn pages.
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