USS invests £392m in Heathrow Airport

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22 Oct 2013

The Universities Superannuation Scheme is to invest £392m in Heathrow Airport this week, its largest infrastructure investment to date.

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The Universities Superannuation Scheme is to invest £392m in Heathrow Airport this week, its largest infrastructure investment to date.

The Universities Superannuation Scheme is to invest £392m in Heathrow Airport this week, its largest infrastructure investment to date.

The £32bn scheme said it had reached an unconditional agreement with Ferrovial to acquire 8.65% of FGP Topco, the holding company which owns Heathrow Airport Holdings. The deal, which is expected to go through on Thursday (24 October), was arranged by USS Investment Management (USSIM), a subsidiary of the pension fund and also its principal investment manager and adviser, which will manage the investment on USS’s behalf.

USS, which is a founding member of the yet-to-invest Pensions Infrastructure Platform, said UK infrastructure is attractive for its members as it can provide inflation-linked, steady cash flows over a lengthy time horizon, which match USS’s long-term liabilities.

USSIM chief executive officer Roger Gray said the deal represented “a significant investment” in “a national asset of key strategic importance”.

He added: “We believe that investment in UK infrastructure is a win-win; promoting economic growth and jobs whilst providing attractive investments for the trustee board in meeting its commitments to members.  This transaction represents a long term investment by USS in the future of London and the UK.”

USSIM head of private markets Michael Powell, said:  “While the Civil Aviation Authority’s final Q6 regulatory proposals are very challenging, USS is investing for the long term.  We have confidence that the right incentives will be set in place to encourage the investment that Heathrow and the UK needs.  Heathrow Airport has a bright future as the UK’s only hub airport and we look forward to the outcome of the Davies Commission.”

 

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