CapAsia exits Malaysia toll road

CapAsia's Southeast Asian Strategic Assets Fund (SEASAF) invested in Cerah Sama, the holding company of Grand Saga, which has a concession to own and operate the toll road, in 2007. According to AVCJ Research, the fund paid approximately $10 million for a 35% stake and committed further capital for debt repayment and business expansion. The investment was made in conjuction with Taliworks, which took a 55% stake.

Completed in 1998, the Cheras-Kajang Highway was one of the first four-lane dual carriageways in Malaysia. It runs for 11.5 kilometers, connecting Cheras, a suburb of Kuala Lumpur, with the city of Kajang in Selangor. Grand Saga was granted a 30-year concession on a build-operate-transfer basis in 1995.

The exit follows SEASAF and Bank of Tokyo-Mitsubishi's sale of their minority interest in the Thailand-based Don Muang Tollway for $132 million in late 2013 to a joint venture between Hong Kong-based First Pacific and Philippines infrastructure developer Metro Pacific Investments Corporation (MPIC). Two other CapAsia funds have significant minority interests in Southeast Asia toll roads.

"SEASAF's investments in operating toll roads in Southeast Asia have performed well, and this is another exit for SEASAF. Over the last seven years the investment in Cerah Sama has provided the fund with a mixture of dividend income and capital returns," Craig Martin, co-CEO of CapAsia, said in a statement.

The fund, which closed at $147 million in March 2007, has one remaining portfolio company - Malaysia-based independent power producer Malakoff, which plans to go public in the second quarter of 2015.

CapAsia manages three infrastructure funds with approximately $300 million in assets. The Islamic Infrastructure Fund - which was initiated by the Islamic Development Bank and the Asian Development Bank - and the Asia Infrastructure Fund both launched in 2009. The Rohatyn Group acquired a 60% interest in CapAsia in 2012, with existing backer CIMB retaining 40%.

Kuala Lumpur-listed Taliworks has infrastructure interests spanning water treatment and supply, waste management, construction and engineering, and toll road operation and management. The Employees Provident Fund is Malaysia's largest pension fund with investment assets of nearly MYR600 billion as of March 2014.

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• Topics
• Exits
• Infrastructure
• Southeast Asia
• Infrastructure
• Southeast Asia
• Malaysia
• Exit
• Trade sale
• CapAsia