Canada’s CPPIB to invest up to US$600m through NIIF

The Canada Pension Plan Investment Board (CPPIB) has entered into an agreement with the National Investment and Infrastructure Fund (NIIF) to invest up to US$600 million through the NIIF Master Fund

December 5, 2019

CPPIB has committed US$150 million in the NIIF Master Fund and has co-investment rights of up to US$450 million in future opportunities

After the latest investment, NIIF Master Fund now has a total of US$2.1 billion in commitments and has achieved its targeted fund size

Other investors in NIIF Master Fund include AustralianSuper, Ontario Teachers’ Pension Plan, Abu Dhabi Investment Authority, Temasek, etc.

The Indian real estate sector attracted foreign PE investment of over US$14 billion between 2015 and Q3 2019, led by commercial real estate

Against the backdrop of India’s burgeoning real estate sector, the Canada Pension Plan Investment Board (CPPIB) announced on December 5 that it has entered into an agreement with the National Investment and Infrastructure Fund (NIIF) to invest up to US$600 million through the NIIF Master Fund. According to the agreement, CPPIB has committed US$150 million in the NIIF Master Fund and has co-investment rights of up to US$450 million in future opportunities alongside the NIIF Master Fund. CPPIB will also become a shareholder in National Investment and Infrastructure Fund Limited, NIIF’s investment management company. 

Set up by the Government of India in February 2015, NIIF is India’s first sovereign wealth fund and manages over US$4 billion in capital commitments across three funds. The NIIF Master Fund invests equity capital in core infrastructure sectors in India, especially on transportation, energy, and urban infrastructure. After this investment, NIIF Master Fund now has US$2.1 billion in commitments and has achieved its targeted fund size. 

In August, AustralianSuper (Australia’s largest superannuation fund) and the Ontario Teachers’ Pension Plan had agreed to invest US$1 billion each in the NIIF Master Fund. Other investors include Abu Dhabi Investment Authority, Temasek, Axis Bank, HDFC Group, ICICI Bank and Kotak Mahindra Life Insurance, alongside the Government of India.  

Scott Lawrence, Managing Director, Head of Infrastructure, CPPIB, said: “[…] Through this investment in the NIIF Master Fund, we are also able to deploy capital in additional projects and sectors across the country, providing further long-term opportunities for CPPIB to invest in infrastructure in India.”

As per a report, the Indian real estate sector attracted foreign private equity (PE) investment of over US$14 billion between 2015 and Q3 2019, of which 63 per cent was focussed on commercial real estate. Earlier data had indicated that the first three quarters of 2019 alone saw inflows of US$3 billion in the commercial segment – an increase of 43 per cent over the corresponding period in 2018. 

India had also come up in top-five preferred markets in APAC with the launch of the first Real Estate Investment Trust (REIT). As compared with 2018, when only 2 per cent of respondents chose India as their preferred location for investments, the interest more than tripled to 7 per cent in 2019. 

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