The NSW government has signed a 99-year lease for just over half of the state’s poles and wires assets with IFM Investors and AustralianSuper.
The consortium, comprised of half IFM and half AustralianSuper, purchased the 50.4 per cent stake in Ausgrid on Thursday for $16 billion.
The deal came after Federal Treasurer Scott Morrison in August blocked bids from Chinese investors for NSW’s electricity distributor.
Mr Morrison at the time cited “national security” concerns in his decision to bar the offer from Chinese-government owned State Grid Corporation and Hong Kong-listed Cheung Kong Infrastructure.
Premier Mike Baird said the deal exceeded expectations and was the single biggest boost to infrastructure in the state’s history.
“On every single criteria this is a win, win, win for the people of this state, for the members of the super fund, and ultimately, I believe strongly, for this economy,” Mr Baird told reporters in Sydney on Thursday.
“It is an incredibly strong result for the people of this state and obviously our new partners are very happy with the result as well.”
About $10 billion in debt would be written off through the deal, leaving $6 billion to spend on infrastructure projects, Mr Baird said.
AustralianSuper chief executive Ian Silk praised the NSW government for its “willingness to harness superannuation money to drive positive outcomes for the state”.
“This all-Australian partnership between the millions of members of our two organisations and the NSW government will maintain and enhance the Ausgrid network vital to so many NSW communities while providing returns that will contribute to the long term retirement savings of the nation’s workers.”
IFM Investors chief executive Brett Himbury said it was a “tremendous outcome” for the estimated 6 million Australian workers who will own a part of the state’s energy infrastructure.
“This Pension Public Partnership makes Australian superannuation money available to build new infrastructure, improving standards of living and productivity. At the same time, the investment in Ausgrid will add to the superannuation accounts of over 6 million Australians.”
Ausgrid supplies electricity to more than 1.6 million homes and businesses across Sydney, the Central Coast and the Hunter regions, according to its website.
IFM Investors is a fund management company owned by industry superannuation funds. It invests on their behalf.
AustralianSuper is the largest of the nation’s industry funds.
As part of the agreement, the consortium also signed a guarantee ensuring Ausgrid network charges will be lower in 2019 than they were in 2014.
* The New Daily is owned by industry super funds.