Qube clarifying CIC’s role in Asciano bid

Qube is reportedly working to assuage concerns over China Investment Corporation (CIC)’s involvement in its bid for Australian port and rail giant Asciano.

The Chinese sovereign wealth fund is an investor with Global Infrastructure Partners, a key financial ally to Qube Holdings in its bid for Asciano, which is currently being reviewed by the Australian Competition and Consumer Commission.

The Chinese fund already owns a small portion of Asciano (under 5%), but questions have been raised this month over the precise role, if any, CIC would take in Qube’s proposed takeover of Australia’s biggest amalgamated port and rail business.

Chinese investment in Australian infrastructure has taken a hit to its image after the Northern Territory’s sale of the Port of Darwin to Chinese firm Landbridge drew criticism from the Australian and US governments.

The sale of the Port of Darwin, Australia’s northernmost transport and defence hub, was not subjected to proper scrutiny by the Foreign Investment Review Board, treasurer Scott Morrison conceded recently.

So now Qube is said to be seeking confirmation from Global Infrastructure Partners (GIP), that CIC would only have a passive role in an acquisition of Asciano.

GIP is set to deliver 40% of the capital needed to purchase Asciano, and is joined in the Qube-led bid by the Canada Pension Plan Investment Board.

The Qube bid is being scrutinised by the ACCC, along with a rival bid from North American investor Brookfield.

Brookfield has made a number of concessions in its bid, including the planned sale of Asciano’s rail subsidiary, Pacific National, should it succeed in its takeover.

Concessions were submitted to the ACCC after the competition watchdog raised concerns over Brookfield’s ownership of Brookfield Rail, which already controls above rail access in much of Western Australia.

The ACCC is set to make a ruling on both bids by February 18.