Transurban Shares Drop as Canadian Pension Plan Exits

By Bizclik Editor


It’s been a bumpy road for the Canadian Pension Plan Investment Board and toll road operator Transurban, and now the two groups are finally parting ways.

Canadian Pension Plan Investment Board is selling its stake in Transurban for $903 million, just over a year after Transurban rejected a $7.2 billion takeover bid from the group, along with other major shareholders CP2 and Ontario Teachers Pension Plan.

Chi-X Has Arrived
Australia's Infrastructure Companies
The Future of Renewable Technologies
Check out the latest issue of Business Review Australia!

It was then that the Ontario Teachers Pension Plan got out, selling a 14 per cent stake and leaving the Canadian Pension Plan Investment Board to fend for itself against Transurban’s $630.5 million purchase of the Lane Cove Tunnel. The purchase was combined with a $542 million accelerated entitlement offering, which was much more than was needed to pay for the purchase.  Despite the Canadian Pension Plan Investment Board, CP2 and Ontario Teachers Pension Plan warning that may not proceed if Transurban went ahead with an equity raising, the toll group did anyway.

Now the Canada Pension Plan has sold almost 170 million shares for $5.23 a piece. The block trade was picked up by a range of mostly domestic institutional investors.  “The entitlement offer was on a 1-for-11 basis at $4.60 a share, a discount of 6.5 per cent to the group's previous security price of $4.92,” The Australian reported.

Commenting on the transaction, Transurban CEO, Chris Lynch said, "Transurban looks forward to working with those existing security holders that have taken the opportunity to increase their stakes and also understanding the views and aims of new security holders to the <span data-scayt_word="register." "="" data-scaytid="1">register.”

Transurban shares fell $0.18 to $5.18 yesterday after the Canada Pension Plan's decision to exit was announced.


Featured Articles

Top 10 best-performing Australian companies: mines to banks

Among Australia’s largest companies by market cap are the country’s Big Four banks, a tech startup that successfully scaled, and two firms with female CEOs

Top 10 richest Southeast Asia: how they made their fortunes

From Singapore’s paint tycoon to Malaysia’s sugar king, we round up the 10 richest people in Southeast Asia – and investigate how they made their billions

Will moonlighting ever become accepted practice in India?

While not a new phenomenon, moonlighting has become a hot button issue across India with IT majors cracking down on it. Will the practice ever be accepted?

New YouTube CEO Neal Mohan joins surge of Indian-origin CEOs

Leadership & Strategy

Ex Infosys President Ravi Kumar is the CEO Cognizant needs

Leadership & Strategy

How India is bucking the global dealmaking downturn

Corporate Finance