CDPQ closes $6.3B REM financing with CIB investing $1.28B

CPE Media News – pcJournal (8/23/2018) – Canada Infrastructure Bank (CIB) is investing $1.28 billion in the form of 15-year senior secured loan in the Réseau express métropolitain project (REM) in Montréal, a 67-km, light rail, high-frequency network with 26 stations.

CIB investment completes the project’s $6.3-billion financing which includes $2.95 billion from CDPQ Infra, a wholly owned subsidiary of Caisse de dépôt et placement du Québec (CDPQ), $1.28 billion from Investissement Québec, $295 million from Hydro-Québec, and $512 million the Autorité régionale de transport métropolitain (ARTM) payment to replace future revenues that CDPQ Infra would have received for the land value capture.

The project is owned 70% by CDPQ Infra and 30% by Investissement Québec.

Construction of the REM began in April 2018. The first trains are scheduled to run in the summer of 2021.

photo credit: CDPQ Infra

News Release

Canada Infrastructure Bank invests in Réseau express métropolitain project with $1.28 billion, 15-year loan

INFRASTRUCTURE
MONTRÉAL, AUGUST 22, 2018

REM project financing completed

Canada Infrastructure Bank and , have reached a business agreement on the investment by Canada Infrastructure Bank in the Réseau express métropolitain project (REM) in Montréal, a 67-km, light rail, high-frequency network with 26 stations.

The $1.28-billion investment completes the project’s $6.3-billion financing. The agreement is subject to the execution of the final documentation.

“We are pleased to participate in the funding of this important public infrastructure project,” said Pierre Lavallée, President and CEO of Canada Infrastructure Bank. “Public transit is one of our priority areas. Our role is to invest alongside private sector and institutional investors, and other public-sector partners to facilitate the development of strategic projects like the REM.”

“We are very pleased to welcome the Canada Infrastructure Bank as a partner in the REM project. With this $1.28-billion investment, the REM’s financing is now fully completed. The construction of the project is progressing well and will intensify in the fall,” said Macky Tall, President and CEO, CDPQ Infra.

Construction of the REM began in April 2018. The first trains are scheduled to run in the summer of 2021.

Investment highlights
The Canada Infrastructure Bank’s $1.28-billion investment will take the form of a 15-year senior secured loan at a rate starting at 1% escalating to 3% over the term of the loan.
Given that the Canada Infrastructure Bank’s investment takes the form of a loan, CDPQ Infra’s equity stake in the REM project will be approximately 70% and the Government of Québec’s stake will be approximately 30%.
Dollar amounts for both CDPQ Infra’s and the Government of Québec’s investments remain unchanged, staying at respectively $2.95 billion and $1.28 billion.
Returns on equity also remain the same, at 3.7% for the Government of Québec and 8-9% for CDPQ Infra.

REM project financing structure
REM construction costs $6.3 B – Financing structure.

ABOUT CANADA INFRASTRUCTURE BANK

Canada Infrastructure Bank attracts private sector and institutional investment and co-invests in new revenue-generating infrastructure projects that are in the public interest. By engaging the expertise and capital of the private sector, the Bank will help provide more infrastructure for Canadians. For more information, visit www.canadainfrastructurebank.ca.

ABOUT CDPQ INFRA

CDPQ Infra is a wholly owned subsidiary of Caisse de dépôt et placement du Québec and is responsible for developing and operating infrastructure projects, including the Réseau électrique métropolitain (REM). The REM is a new, integrated 67-km public transit network intended to link downtown Montréal, the South Shore, the West Island (Sainte-Anne-de-Bellevue), the North Shore (Laval and Deux-Montagnes) and the airport through the operation of an entirely automated and electric light rail transit (LRT) system.

For more information on CDPQ Infra, visit cdpqinfra.com, follow us on Twitter @CDPQInfra or consult our Facebook page.

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JEAN-VINCENT LACROIX
CDPQ Infra
514-847-2896
jvlacroix@rem.info

GABRIELLE DOUCET
Canada Infrastructure Bank
416-342-1852
media@canadainfrastructurebank.ca

DAVID WILLS
Canada Infrastructure Bank
416-342-1809
media@canadainfrastructurebank.ca

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