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Asia corporate elite in $2.4bn tussle for Q-Park

Cheung Kong Infrastructure and Fosun International are among several Asian groups that have submitted bids for Q-Park, one of Europe’s largest parking lot operators, in a deal that could fetch more than $2.4bn.

China Oceanwide, a Beijing-based conglomerate owned by a billionaire banking magnate, and Shougang Group, a state-owned Chinese steel company, also joined the first round of bidding on the Netherlands-based parking group, two people familiar with the matter said.

The battle for Q-Park has attracted some of Asia’s biggest corporate names. CKI is controlled by Hong Kong’s Li Ka-shing, one of Asia’s richest men. Fosun — which placed a bid at the start of the auction but it is no longer part of the process, according to a source familiar with the bids — is led by Guo Guangchang, the self-proclaimed “Warren Buffett of China”.

Infrastructure assets in Europe have attracted a flurry of interest from Asian buyers, with Chinese companies last year flocking to the market in order to diversify away from slower-growth investments at home.

Q-Park operates 6,100 parking lots in 10 countries including the UK, France and Germany, according to the company’s website. It owned €1.25bn worth of property at the end of 2015, according to an annual report from that year. The company earned a net profit of €90.9m in 2015.

EQT Holding, a Swedish private equity firm, also reportedly submitted a bid for Q-Park.

Q-Park, China Oceanwide and CKI did not respond requests for comment. Fosun declined to comment. Calls to Shougang’s headquarters in Beijing went unanswered.

Chinese companies spent $19.5bn last year on global infrastructure including construction, utilities and energy assets, up from $11.9bn in 2015, according to Dealogic. About $6.4bn of that, or 33 per cent, was focused on Europe. Latin America pulled in 50 per cent of total spending in the sector.

In December, China’s sovereign wealth fund China Investment Corp joined a consortium of investors that agreed to pay £3.6bn in cash for equity interest for a controlling stake in the gas distribution division of the UK’s National Grid.

Among Asia buyers, Fosun has been a force in the market for cross-border deals over the past few years.

The company most recently spent €531m to increase its stake in Portugal’s largest listed lender Millennium BCP to 30 per cent. It also owns Caixa Seguros Saúde, Portugal’s largest insurance group, but is best known for taking controlling stakes in European resort operator Club Med and Canadian entertainment group Cirque du Soleil.

CKI featured in a number of global infrastructure deals in 2016 and owns power and water supply assets in the UK.

China Oceanwide is a more recent entrant. Controlled by Lu Zhiqiang, a founding shareholder in China’s largest privately held bank, Oceanwide announced in October that it would pay $2.7bn to buy Genworth Financial, a US insurance company.

Chinese companies announced some $220bn in cross-border deals last year — more than double 2015’s level. But many have run into difficulties obtaining approval from Chinese regulators to make outbound acquisitions as Beijing cracks down on capital flight.

Via FT