RRJ Capital: There’s Gold In Those Eastern Roads

The deal would give RRJ another big score in Asia

RRJ Capital isn’t a household name to most Western investors.

But the Asian private equity firm is tapping into an asset class that often goes ignored: Toll roads.

RRJ Capital has proposed a deal to purchase PLUS Malaysia Bhd, the country’s biggest expressway toll firm, for $716 million, according to Reuters. In their proposal, RRJ has reportedly offered to cut tolls by as much as 20% immediately upon taking possession of the properties.

Background RRJ Capital

Richard and Charles Ong founded RRJ Capital and opened offices in Hong Kong and Singapore. The firm now has $11 billion under management.

The firm’s previous acquisitions include Jubao Internet Technology, an Internet financial services platform and Chinese infrastructure firm Shanghai Yupei Group. In addition, the company purchased Lai Sun Development, a mid-sized developer in  Hong Kong.

The company sees an opportunity now in the troubled Malaysian economy. Heavily in debt, the government wants the private sector to be more engaged. Privatization has emerged as a solution.

Turning Back to the Roads

Meanwhile, PLUS Malaysia is owned by a state pension fund EPPf. The pension fund holds 49% of the property.

However, UEM Group Bhd, a subsidiary of Khazanah, owns the majority 51% of the road.

A Khazanah spokesperson commented on the proposed deal. “There have been several proposals on toll highways,” the spokesperson said. “Khazanah itself has submitted its own proposal to the government. Ultimately, it is up to the government to consider these proposals and decide what is best for the country and the people.”

That said, RRJ will continue to tap into long-term investments across Southeast Asia. “Our focus will be large companies and major infrastructure investments such as airports, container ports, water treatment plants, and toll roads,” the firm said in an email to Reuters.

The deal must meet additional conditions including an extension of the toll concessions period for an additional 20 years by the government.

Finally, for more insight on global deals and news, sign up for the DailyAlts Playbook.

Free Industry News

Subscribe to our free newsletter for updates and news about alternatives investments.

  • This field is for validation purposes and should be left unchanged.


Alt Insights

January 16, 2020

ESG: Lately-turned Tesla Bull Jim Cramer Adds Fink To The Mix

ESG: Lately-turned Tesla Bull Jim Cramer Adds Fink To The Mix
Shape

Latest Alternative Investment News

Hedge Funds are Selling Oil Again
January 21, 2020     Hedge Funds, Investments, News

NYMEX and ICE WTI data show that hedge funders were net sellers of crude oil for the week ending January 14. Funds sold roughly 99 million barrels in the six…

Digital Assets: UAE a Flag-bearer for Blockchain Technology Deployment
January 20, 2020     Digital Assets, News

The UAE is a Flag-bearer for Blockchain Technology Deployment. A joint white paper has been issued by the World Economic Forum and the United Arab Emirates’ Centre For The Fourth…

Digital Assets: Bitwise/ETF Trends 2020 Survey – 65% Advisors Want to Buy Bitcoin in an ETF
January 20, 2020     Digital Assets, News

The Bitwise / ETF Trends 2020 Benchmark Survey of Financial Advisor Attitudes Toward Cryptoassets gives useful insight into what advisors are thinking about Bitcoin and cryptos going into 2020. ETFs…

ESG: Best Buy’s CEO in the Dock for Alleged ‘At-Work’ Liaison
January 20, 2020     ESG and Sustainability, Latest News, News

Current Best Buy CEO Corie Barry allegedly had a romantic relationship with a male colleague before taking charge as CEO in June 2019. Best Buy’s board is investigating the charge,…