APG, PGGM buy controlling stake in tank operator

A consortium involving APG and PGGM shelled out $277m for a chunk of LBC from infrastructure fund Challenger. The deal will close in the summer.

A consortium featuring Algemene Pensioen Groep (APG) and PGGM has paid $277.8 million for a 66 percent stake in LBC Terminals Jersey, the second largest tank storage operator in the world.

Seller Challenger Infrastructure Fund (CIF), a publicly listed infrastructure vehicle owned by multibillion dollar Sydney, Australia asset manager Challenger, said the deal should be completed by August.

The sale left CIF with Inexus, a Cardiff, Wales utility, as its lone asset, according to the fund, which added investment bank Rothschild acted as its adviser. Challenger said Rothschild is conducting a strategic review of CIF, including its stake in Inexus.

Divesting its stake in LBC let Challenger shore up its financial condition, raising its available cash to $400 million, according to Emil Pahljina, CIF chief executive.

Access Capital Advisers, which acted as asset consultant to the consortium, called LBC “a valuable, long-term, core infrastructure asset that performed well during the global financial crisis and recession”.

Access, an adviser to $8.6 billion, credited its head of Europe, Stephen Burns, for his role in steering the transaction, noting Baker & McKenzie acted as legal counsel.

APG, with $370 billion under management, and PGGM, a $150 billion pension fund manager, are both based in the Netherlands.