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AMP Capital increases stake in Auckland South Corrections Facility
Investment management
06 May 2020

AMP Capital has completed the acquisition of an additional 30 per cent equity stake in the Auckland South Corrections Facility (ASCF) from John Laing on behalf of investors in the AMP Capital Community Infrastructure Fund (CommIF) and AMP Capital Core Infrastructure Fund (CIF).

The transaction reached financial close yesterday and follows AMP Capital’s initial 40 per cent equity stake in ASCF, which was acquired from InfraRed after approvals from the New Zealand Overseas Investment Office and the New Zealand Department of Corrections in December 2019.

The transaction increases AMP Capital’s overall equity stake in ASCF to 70 per cent. The asset marks AMP Capital’s 18th social infrastructure asset and the fourth acquisition in New Zealand.

The ASCF project was delivered as a Public-Private Partnership (PPP) and commenced operations in 2015. The 960-bed facility is focused on rehabilitation and training to support prisoners’ reintegration into the community.

AMP Capital CIF Fund Manager John Julian said: “This is an exciting new addition to the CIF portfolio. CIF aims to provide retail investors with consistent and sustainable returns including an attractive income yield over the long term, and this acquisition is well-aligned to this objective especially amid the current market volatility.”

CIF provides retail investors with access to unlisted infrastructure assets typically only available to large institutional investors, as well as listed infrastructure companies. The Fund provides diversified global exposure to multiple sectors, OECD regions and asset types including airports, transport infrastructure, water, gas, electricity and social infrastructure projects.

Charles Savage, CommIF Fund Manager said: “We are looking forward to expanding our presence in the New Zealand PPP market and continuing to invest in projects that benefit the community. Increasing our interest in the ASCF aligns closely with CommIF’s positive social impact objective and provides investors with increased diversification benefits.

“CommIF has established itself as a leader in the brownfield community infrastructure sector, backed by its asset and investment specialists. We are delighted to see that the strong support from our investors has not been impacted by the market volatility due to the stable and defensive nature of these projects. We are looking forward to building our relationships with new partners and investors in New Zealand,” said Mr Savage.

AMP Capital currently manages 18 brownfield assets structured as (or similar to) PPP projects in Australia and New Zealand, with an enterprise value of approximately A$6.8 billion. These include assets in education, health, corrections, transport, water and community sectors.