THE government-owned Queensland Investment Corporation has emerged as the biggest buyer in the state’s asset sale program.
The Bligh government announced yesterday that instead of selling Queensland Motorways on the open market it had entered into an exclusive agreement to sell it to QIC for about $3 billion.
QIC also owns 27 per cent of the consortium which a fortnight ago paid $2.1bn for the Port of Brisbane and also undertook to pay $200 million for roadworks to the port.
QIC also has exposure to the privatisation of Queensland Rail through investments in various index funds that have taken a position in the QR float. Consequently, with only the port at Abbot Point yet to be sold — and it is valued at $1.5bn compared with $4.6bn for QR National, QML at $3bn and the Port of Brisbane for $2.1bn — QIC will be the biggest buyer in the program, regardless of whether it is involved in that purchase.
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QIC is one of the superannuation arms of the Queensland public service and, as such, is fully owned by the Queensland government, although it claims to be fully independent.
Under yesterday’s agreement, the two parties will enter detailed talks to arrive at a definite value for QML, expected to be finalised before June 30 next year.
Queensland Treasurer Andrew Fraser said QIC had approached the government about a month ago over getting an exclusive mandate over QML, and said the organisation had a history of “muscling up” in its investments.
“While I’m confident that we would have had a successful transaction, I don’t think anyone’s going to make the case that the toll road investment market is anything other than a little bit soft,” he said. “So this is an elegant solution in that, given the uncertainties in the toll road market in particular, we got a good deal.”
Premier Anna Bligh said although QIC was legislatively a separate entity from the government, the deal was not unusual. “The sale of the Port of Brisbane involved a consortium and part of that consortium — almost 30 per cent — was QIC. So QIC has already bought one of the assets.
“And what they’re doing here is buying the whole thing. “So QIC is already the purchaser of Queensland government assets; they buy assets in other markets as well, there’s nothing unusual about this purchase,” the Premier said. “If the QIC weren’t buying this tollway, they would be buying a tollway in Europe or America or somewhere else.”
QIC chief executive Doug McTaggart said in a statement the organisation had investments in a range of infrastructure, including the Brisbane Airport Corporation, Westlink M7 in Sydney and Thames Water in Britain. “QIC Global Infrastructure has long had an interest in Queensland Motorways Ltd,” he said.
A spokeswoman for Transurban, owner of Melbourne’s City Link and the Hills M2 and Lane Cove Tunnel in Sydney, declined to comment on the sale yesterday. However, it is believed the listed toll-road operator, along with several long-term pension funds, had held discussions with the Queensland government regarding the sale of the asset. One party close to the talks expressed surprise at the government’s decision given it had yet to formally call for expressions of interest.