The pension fund will sell an 83.5% stake in the transcontinental pathway.
The infrastructure arm of the Ontario Municipal Employees’ Retirement System (OMERS) has completed a $312 million sale of the Detroit River Rail Tunnel to transcontinental railway company Canadian Pacific (CP).
Canadian Pacific will take full ownership of the railway after the transaction, the firm said this month. It purchased an 83.5% stake from OMERS and previously held just a 16.5% stake in the tunnel.
The Ontario pension fund for municipal employees has been invested in the Detroit River Rail Tunnel for nearly two decades. OMERS, which boasts a sizable allocation to infrastructure, invests $16.2 billion to the asset class, or nearly one-quarter of its $82.7 billion total portfolio that is managed by in-house managers. In fiscal year 2019, the allocation returned 8.7%, beating its benchmark of 7.9%.
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CP completes acquisition of Detroit River Rail Tunnel
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CALGARY, Dec. 22, 2020 /PRNewswire/ - Canadian Pacific (TSX: CP) (NYSE: CP) announced today it has completed its previously announced agreement to purchase an 83.5 percent stake in the Detroit River Rail Tunnel from certain affiliates of OMERS, the defined benefit pension plan for municipal employees in the province of Ontario. CP previously owned a 16.5 percent stake of the tunnel in partnership with OMERS. The purchase price for the transaction is approximately US$312 million, subject to customary closing adjustments.
About Canadian Pacific
Canadian Pacific is a transcontinental railway in Canada and the United States with direct links to major ports on the west and east coasts. CP provides North American customers a competitive rail service with access to key markets in every corner of the globe. CP is growing with its customers, offering a suite of freight transport