Aussie fund sells stake in Texas LNG terminal

[SYDNEY] Australia's Hastings Funds Management said that it will sell its quarter stake in a Texas liquefied natural gas (LNG) terminal to US specialist fund Global Infrastructure Partners for US$1.1 billion, five-and-a-half times what it paid four years ago. The deal continues a bumper year for Australian mergers and acquisitions (M&As) with transactions totalling US$79 billion in the six months to June 30, compared with US$45 billion in the first half last year, according to JP Morgan. So far in 2014, the country has had 20 deals worth over US$1 billion, compared to just 17 for the entire previous year.

The sale of the 25 per cent stake in Freeport LNG Development LP also shows the funds management sector's strong appetite for energy infrastructure assets globally. Hastings, owned by Australia's No 2 bank Westpac Banking Corp, sold the stake just as Freeport, which runs a LNG regasification terminal, starts construction on three new liquefaction plants which are expected to begin operations in four years. "It was timely for Hastings to monetise the investment given strong market demand for assets exposed to the LNG value chain," Hastings executive director of global investment Peter Taylor said. "We are long-term investors but we do not ignore the market and will move to maximise value."

Hastings has been managing the Freeport stake, bought for about US$200 million in 2010, for Australian funds Utilities Trust of Australia and The Infrastructure Fund, and Zachry American Infrastructure LLC. JP Morgan Securities LLC represented Hastings and Zachry on the deal. - Reuters