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Canada's CPPIB boosts stake in Peru pipeline company

Canada's CPPIB boosts stake in Peru pipeline company

Posted by Juan Gavasa on March 25, 2014

The Canada Pension Plan Investment Board (CPPIB) said on Monday it has bought an additional 23.6 percent stake in Transportadora de Gas del Perú (TgP), the country's largest transporter of natural gas and natural gas liquids, from Tecpetrol International SA, and would become the biggest shareholder.

CPPIB, which manages investments for Canada's national pension plan, said it also expects to buy a 2.4 percent interest in TgP from Spanish pipeline operator Enagás Internacional and 0.4 percent from Peruvian investor Corporación Financiera de Inversiones. Those transactions would take its stake in TgP to 36.8 percent. In January, CPPIB announced a deal for its original 10.4 percent stake in TgP..

The pension fund manager said it had also acquired TgP's operator, Compañía Operadora de Gas del Amazonas, from Argentine energy firm Tecpetrol, paying $607 million for the two assets. But it will sell 51 percent of Compañía Operadora de Gas del Amazonas to Peruvian engineering and construction company Graña y Montero and 30 percent to Enagás Internacional.

In making the deal for the enlarged TgP stake, CPPIB said it was exercising a right of first refusal. Its move effectively replaces a similar deal that had been planned by Grupo Energia de Bogota, a distributor of gas and power with assets in Peru. The Colombian company said on Jan. 16 that it had agreed to buy Compañía Operadora de Gas del Amazonas and a 23.6 percent stake in TgP for $650 million.

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