Caisse de Depot et Placement du Quebec, Montreal, will invest $5 billion in three strategic assets in the United Arab Emirates in a joint venture with DP World.
Specifically, CDPQ will invest a total of $5 billion in the Jebel Ali Port, the Jebel Ali Free Zone and the National Industries Park in Dubai through a new joint venture with DP World in which CDPQ will hold a stake of about 22%, according to a joint news release Monday from CDPQ and DP World.
CDPQ will invest $2.5 billion in equity and $2.5 billion in debt in the transaction, a CDPQ spokesman said in an email.
DP World will own the other 78% of the joint venture for the three assets, the CDPQ spokesman confirmed.
DP World is a Dubai-based global ports operator, a DP World spokesman confirmed in an email.
Also, under terms of the agreement, other long-term investors will be able to acquire an additional stake of up to $3 billion in the three assets, the news release said.
The first tranche of the transaction, the $5 billion investment, is expected to close in the second or third quarter of 2022, the release added. The second tranche, the investments of up to $3 billion by other investors, is expected to close during the fourth quarter of 2022.
The overall transaction suggests a total enterprise value of about $23 billion for the three assets, the release said.
The three assets, which will remain fully consolidated businesses within DP World, generated pro-forma revenue of $1.9 billion in 2021, the release said.
"This investment in Jebel Ali is another great illustration of the partnership between CDPQ and DP World, which now spans four continents and 18 terminals," said Emmanuel Jaclot, executive vice president and head of infrastructure at CDPQ, in the release.
"We have had a global partnership with CDPQ since 2016, and we have co-invested in many assets across the globe including in Canada, Australia, Chile and Dominican Republic," the DP World spokesman said. "This partnership in the UAE was a natural broadening of this relationship, and we believe bringing CDPQ on board will help us accelerate the growth in the three UAE assets."
CDPQ had net assets of C$419.8 billion ($328.5 billion) as of Dec. 31.