THE Future Fund has emerged as the biggest shareholder in Transurban after snapping up stock from the sell-down by Sydney infrastructure investor CP2 in Australia's largest listed toll road early this week.
Substantial shareholder notices show the federal government's Future Fund now has a 6.78 per cent holding in Transurban, equating to almost 99 million shares.
Another notice filed yesterday shows RARE Infrastructure, a fund manager the Future Fund uses to manage its money, has increased its stake in Transurban from a little more than 5 per cent to 8.17 per cent. But the Future Fund's 6.78 per cent holding in Transurban is included in RARE's stake.
The Future Fund, set up to provide for superannuation payments to public servants, has made clear its interest in boosting its holdings in infrastructure assets such as toll roads and airports. Infrastructure stocks such as Transurban appeal to investors such as the Future Fund because of the defensive nature of their earnings and inflation protection.
Transurban has the ability to raise tolls on motorways when inflation spikes.
The Future Fund also has a 5 per cent stake in Sydney Airport, the country's largest, and effectively owns 17 per cent of Melbourne and Launceston airports.
In 2010, it spent more than $200 million to buy a 17.2 per cent stake in Britain's Gatwick Airport.
The sale of a 7.86 per cent stake in Transurban by CP2 earlier this week on behalf of two European pension funds for $632 million leaves the Sydney fund manager's holdings in the owner of Sydney's Lane Cove Tunnel and Melbourne's CityLink at 4.73 per cent. Transurban is expected to name its chief financial officer, Tom Honan, soon as the successor to its chief executive, Chris Lynch, who will step down in July after four years at the helm.