AMP Capital has agreed to acquire an additional 3 per cent stake in the Victorian Desalination Project (VDP) from Melro Ltd and Suez Water Pty Ltd on behalf of investors in its Community Infrastructure Fund (CommIF). The deal will take AMP Capital’s share of the Victorian Desalination Project to 20.4 per cent.
Victorian Desalination Project, delivered as a public private partnership (PPP), is the largest desalination plant in the Southern Hemisphere. It is a rainfall-independent source of drinking water and capable of supplying up to 150 gigalitres a year, which is approximately one third of Melbourne's annual water consumption.
The plant uses a reverse osmosis process to desalinate water in a highly energy efficient way, then delivers the water through an 84 kilometre transfer pipeline to Cardinia Reservoir, before entering the Melbourne network.
Charles Savage, CommIF Fund Manager said: “The Fund is proud to have secured yet another stake in this world-class asset. The plant has been one of the cornerstones of the Fund in recent years, delivering strong, stable operational performance since it was first acquired in 2016. Its market-leading design combined with its strong focus on sustainable practices has been key to its success.
“The acquisition will grow CommIF’s exposure to the Victorian Desalination Project and the water sector more broadly, complementing a water portfolio which includes existing investments in VDP, Riverland Water, and AquaTower,” Mr Savage said.
The project is seeing the plant being used more frequently as an integral part of Melbourne’s drinking water supply.
“CommIF is the leading investor in social infrastructure PPP assets across Australia and New Zealand. AMP Capital has a proven track record in the social infrastructure market and continues to be one of the most active market participants in this space. The Fund has delivered strong and stable returns to investors for a long period of time, including throughout the 2020 Covid-19 period, demonstrating the benefits of its core investment strategy.”
“Despite the current market volatility, we remain focused on creating value for our clients, project counterparties, and the community,” he concluded.
CommIF invests predominately in high-yield, brownfield, social infrastructure PPP assets in Australia and New Zealand in sectors such as education, health, corrections, community housing, essential services and recreational facilities. The fund provides investors with the opportunity for stable, long-term returns. The fund has 16 assets with a net asset value of over A$1 billion.
About AMP Capital
AMP Capital is a global investment manager with A$190 billion in assets under management as of 31 June 2020 and more than 250 investment professionals. AMP Capital has a heritage and strength in real estate and infrastructure, and experience in fixed income, equities and multi-asset solutions. AMP Capital is owned by AMP Limited, which was established in 1849, and is one of Australia's largest retail and corporate pension providers.