One reason for this may have been the fact that DB is planning to sell RREEF. ASX-listed Asciano, the port’s operator, also acquired a 20 per cent interest in the asset from Australian Infrastructure Fund.
Port of Geelong is the largest regional port in Victoria and handles a broad range of bulk commodities including woodchips, crude oil and petroleum, steel, fertiliser, chemicals and alumina.
RREEF Infrastructure’s acquisition was made on behalf of one its Australian institutional clients, is expected to be completed by 29 February and isn’t conditional.
RREEF Infrastructure portfolio manager and head of asset management Richard Hedley said the group initially invested in Port of Geelong in 1996 when it was privatised by the Victorian government and it has delivered strong cash distributions and capital growth to clients to
date.
Australian Infrastructure Fund will receive $24.9 million from its sale of its 35 per cent stake in Port of Geelong, plus a distribution of net income and franking credits generated from the asset from July
1 to the expected date of sale completion, February 29.
The group purchased its stake in the asset in September 2000 for $8.3m and has generated an annual total average return since inception of 23 per cent.
Australian Infrastructure Fund chief executive officer Jeff Pollock said the stake sale reiterates the fund’s commitment to focusing its on key airport assets, which will comprise 96 per cent of its
portfolio once the Port of Geelong sale has completed.
“We remain committed to actively pursuing all opportunities to maximise shareholder value,” Mr Pollock said, adding the proceeds from divestment will be retained to provide funding flexibility.