By Yantoultra Ngui and Rozanna Latiff
SINGAPORE/KUALA LUMPUR (Reuters) - Global Infrastructure Partners (GIP) is in talks to buy up to a 49% stake in MMC Port Holdings, in a deal potentially valuing Malaysia's biggest port operator at around 30 billion ringgit ($6.4 billion), two sources with knowledge of the matter said.
The infrastructure investor has begun seeking financing for the potential acquisition of a stake in MMC Port, part of the MMC Corp conglomerate controlled by Malaysian tycoon Syed Mokhtar Al-Bukhary, one of the sources said.
A 49% stake in MMC Port would be worth $3.1 billion, although it is not clear yet what kind of premium will be agreed on by the two companies.
Talks are ongoing and there is no certainty that a deal will be reached, said the sources. They declined to be named as the discussions were confidential.
A spokesperson for GIP in New York declined to comment. MMC Corp did not immediately respond to a request for comment.
Founded in 2006, New York-headquartered GIP manages more than $100 billion in assets and has a portfolio including Britain's Gatwick airport, the Port of Melbourne and major offshore wind projects.
If completed, GIP's Malaysian investment will add to the hectic pace of mergers and acquisitions in the infrastructure sector globally in recent years, with soaring demand for logistics making the asset class increasingly popular.
As part of that trend, GIP itself is being acquired by BlackRock (NYSE:BLK) for $12.5 billion.
Just days after the announcement by BlackRock, which manages $10 trillion across all markets, U.S. private equity firm General Atlantic said on Tuesday it agreed a deal to buy UK-based infrastructure investor Actis.
Global private equity firms, sovereign wealth funds, and other investors have been pouring money into Asia infrastructure projects in recent years to get exposure to assets that are seen offering, stable, long-term and inflation-beating returns.
Reuters first reported in May last year, citing sources with knowledge of the matter, that Syed Mokhtar, ranked as the 11th richest man in Malaysia by Forbes, was looking at bringing an investor into MMC Port Holdings.
The company has seven ports in Malaysia - Port of Tanjung Pelepas, Johor Port, Northport, Penang Port, Tanjung Bruas Port, SPT Services and Andaman Port, according to its website.
All are located along the Straits of Malacca, one of the world's busiest shipping lanes.
($1 = 4.7140 ringgit)