Sydney Airport bid a sign of Australian super powers

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Euromoney, July 5 2021

The bid for Australia’s biggest airport highlights pension funds as the most powerful names in town. And take a look at the advisers.

The A$22.3 billion ($17 billion) bid for Sydney Airport on Monday confirms a growing theme: the outsize power of Australia’s superannuation, or pension fund, sector.

The bid comes from a consortium that includes IFM Investors, an investment management company owned by 27 not-for-profit Australian super funds; QSuper, a Queensland-based super fund with A$117 billion of assets under management; and US fund Global Infrastructure Management.

Also, its success is contingent upon agreement from another super fund – UniSuper, which today is the biggest shareholder in Sydney Airport with a 15% holding – to reinvest its equity for an equivalent stake in the consortium’s holding vehicle, if successful.

The Australian super sector was worth A$3.1 trillion as of March 31, according to the Australian Prudential Regulation Authority, making it one of the largest institutional asset pools in the world. Its scale is out of step with the economy – double the national GDP, for example, and well over the A$2.44 trillion entire market capitalization of the ASX – and it has long been a challenge for the larger funds to invest their assets.

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Chris Wright
Chris Wright
Chris is a journalist specialising in business and financial journalism across Asia, Australia and the Middle East. He is Asia editor for Euromoney magazine and has written for publications including the Financial Times, Institutional Investor, Forbes, Asiamoney, the Australian Financial Review, Discovery Channel Magazine, Qantas: The Australian Way and BRW. He is the author of No More Worlds to Conquer, published by HarperCollins.

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