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FNPF Explains Fiji Ports Corporation Ltd Investment

The Fiji National Provident Fund is pleased to make its first significant investment through Government’s Public Private Partnership program. FNPF will now be a prominent investor in the infrastructure sector
10 Nov 2015 09:14
FNPF Explains Fiji Ports Corporation Ltd  Investment

The Fiji National Provident Fund is pleased to make its first significant investment through Government’s Public Private Partnership program.
FNPF will now be a prominent investor in the infrastructure sector through its recent acquisition of 39 per cent shareholding in Fiji Ports Corporation Ltd (FPCL), a wholly-owned government company that owns all major ports in the country.
This investment in FPCL is in line with the Fund’s strategy to diversify its portfolio and help boost long term investment returns to members.
FNPF Chairman Mr Ajith Kodagoda said that given the liabilities to FNPF members are long term in nature and the limited investment opportunities locally, core economic infrastructure assets provides the balanced risk return asset base that will enable the Fund to provide stable long-term income and future growth for its members.
“Normal investment approaches through traditional asset classes, in particular bonds and deposits, are no longer sufficient to generate the required yields for our members,” Mr Kodagoda said.
“He added that accordingly, the Fund will continue to explore a diverse range of asset classes, such as core infrastructure, direct equity, and direct property development, to enhance returns.
“To achieve this, having partners with the right technical expertise, financial and management capability and proven experience in infrastructure investment, who is also attuned to our own strategy of creating real value, was paramount.”

Partnership
Together with Aitken Spence PLC, the Fund formed a consortium and submitted a bid for 59% controlling shares, in response to Government’s call for expressions of interests in the partial divestment of FPCL.
“The common theme is our shared ability to identify and develop potential opportunities and mitigate risk, and our partnership with Aitken Spence PLC, a seasoned investor with port management expertise and technical know-how, is a testament to this,” Mr Kodagoda said.
“This transaction saw like-minded long-term infrastructure investors with similar strategic approaches unite.”
Aitken Spence has been recognised for three consecutive years by Forbes as one of the most successful publicly-traded companies with annual sales under US$1 billion outside of the United States.
It has been a partner in FPCL since August 2013 after it acquired controlling shareholding in Fiji Ports Terminals Ltd and signed a 15-year concession agreement to manage the Suva and Lautoka international ports. In that time, it has increased productivity by 60 per cent, improved vessel turnaround time by 33 per cent amounting to a 50 per cent increase in net profits in its first year of operations.
The legal agreements relating to the acquisition were signed on November 5th, 2015 by the Prime Minister Voreqe Bainimarama, and FNPF Directors Mr Tom Ricketts and Mr Sashi Singh.
The signing is a landmark in the divestment programme initiated by the Fijian Government. The total investment in FPCL by the consortium for a 59% shareholding is FJ$99,112,330.00.
The Fund was successfully selected in its bid for the Airports Fiji Limited and had also expressed interest in the Fiji Electricity Authority’s divestment process.

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