Melbourne supremacy

19 September 2016 By Quentin Webb

The latest privatisation Down Under sees a consortium leasing Melbourne’s port for a punchy 25 times EBITDA. It underscores the huge global appetite for assets offering decades of reliable returns – and is a reminder that Australia can afford to be picky over new owners.

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An international bidding group won a 50-year lease of Australia's biggest maritime hub, the Port of Melbourne, for a higher-than expected A$9.7 billion ($7.3 billion), the state government of Victoria said on Sept. 19.

The Lonsdale consortium includes two Australian investors: Future Fund, the national sovereign wealth fund, and QIC of Queensland. It also includes Global Infrastructure Partners and Canadian pension fund OMERS. The quartet beat a rival bid from IFM Investors, Macquarie Infrastructure and Real Assets, and APG Asset Management, the Dutch pension fund manager.

On Sept. 16, Reuters, citing advisers to the two groups, said final bids would fall in the range of A$6 to A$7 billion.

The deal is set to close on Oct. 31. Gresham Partners and Credit Suisse advised Lonsdale. Morgan Stanley and Flagstaff Partners advised the state of Victoria.

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