GIC announced two mega deals involving infrastructure in the U.S. and Europe.
In the first deal, GIC announced that it has tied up with Brookfield Infrastructure to acquire U.S. railroad owner Genesee & Wyoming (G&W) in a deal valued at about $8.4 billion (including debt). Brookfield Infrastructure's investment will be about $500 million of equity, while the remainder of the business will be owned by Brookfield Infrastructure's institutional partners and GIC, the companies said in the joint statement on Monday
«The long-term investment horizon of Brookfield Infrastructure and GIC as seasoned infrastructure investors are perfectly aligned with the long lives of G&W railroad assets, which are integral to the local economies that we serve in North America and around the world,» said Jack Hellmann, G&W's chief executive officer, in the media announcement.
Portfolio Of G&W
Under new ownership, G&W will continue to focus on safety and service while driving the company's strategic goals. G&W owns a portfolio of 120 short line railroads, largely in North America, with operations in Europe and Australia.
G&W shareholders will receive $112 in cash per share of common stock, which represents a 39.5 percent premium to its share price of $80.28 on March 8, the day prior to initial media speculation of a potential transaction. Sam Pollock, CEO of Brookfield Infrastructure, highlighted that G&W would be «a significant addition» to Brookfield Infrastructure's global rail platform, expanding its footprint in the sector to four continents.
Second Deal
Separately, GIC said it had entered into an 80:20 joint venture with data centre company Equinix to acquire and develop six hyperscale data centres in Europe for over US$1 billion, with the transaction expected to close in the third quarter.
«As a long-term value investor, we are confident that the strong growth in data consumption and public cloud data storage will continue to drive secular demand for hyperscale data centers. We believe the venture portfolio will generate steady and resilient returns in the long run,» said Lee Kok Sun, the chief investment officer of GIC Real Estate in a press statement.
Centers in London and Paris
The JV will acquire two operational data centers in London and Paris which deliver a combined 31 megawatts of power to customers. In addition, there are plans to further develop a data center each in London and Amsterdam and two sites in Frankfurt. Upon full development, these six facilities will provide some 155 megawatts of power capacity. Equinix will develop, operate, and manage the data centers.
«The JV structure will enable us to extend our cloud leadership while providing significant value to a critical set of hyperscale customers,» said Charles Meyers, chief executive of Equinix.
