Energy, Transport and Utilities Deals in Asia-Pacific – May 2015

by Ee Fai Kam

  • 28 May 2015
  • INF
  • NR

This week saw a flurry of activity in Asia-Pacific infrastructure: founding members of the recently established Asian Infrastructure Investment Bank (AIIB) held a three-day operational policy meeting, Japan announced a $100bn budget to develop transportation assets in Asia, and CalPERS formed a $764mn infrastructure partnership with QIC to invest in the region. These are encouraging signs; according to Asian Development Bank, Asia has an $8.2tn infrastructure funding gap between 2010 and 2020.

What has been done so far to bridge this gap? Preqin’s Infrastructure Online tracks over 1,650 deals worth $326bn in the energy, transport and utilities spaces – the same sectors that AIIB, Japan and CalPERS are targeting. In 2014 alone, $43bn worth of infrastructure deals was completed, the highest on record. Of these $43bn deals, 55% was committed to the transport sector, 25% to utilities and 20% to energy assets. Among these transactions, North West Rail Link stands out as the largest deal in Asia-Pacific in 2014. The $7.8bn greenfield rapid transit train system, awarded to a consortium of multi-national investors, is also Australia’s largest public transport project. Investors in North West Rail Link include Japan’s Marubeni Corporation, Hong Kong’s MTR Corporation, Australia-based manager Palisade Investment Partners and Partners Group in Switzerland.   

In 2015 so far, 22 deals have been completed within Asia-Pacific in the energy, transport and utilities sectors for an aggregate value of $6.6bn. Compared with the $21bn worth of deals completed in the same period last year and the $16bn in 2013, deal flow appears slower this year. This reinforces the timeliness of AIIB, Japan and CalPERS’s entry, which can go some way towards meeting the region’s long-term infrastructure needs.

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