http://www.couriermail.news.com.au/story/0,20797,19042364-3122,00...

http://www.couriermail.news.com.au/story/0,20797,19042364-3122,00.html

Bank that keeps on growing

Roz Alderton

May 06, 2006

This article from : AAP

MACQUARIE Bank's mooted takeover bid for stevedore Patrick Corp is the latest move by the investment bank as it snatches up infrastructure assets around the globe.

Macquarie has been on a meteoric rise over the past few years, taking on increasingly bigger and more ambitious deals as it builds up a collection of airports, toll roads, radio transmission towers and shopping centres.

The group has recently turned its attention to ports, which fit snugly into its investment criteria.

Macquarie goes after assets that operate with a near-monopoly in markets with high barriers to entry, ensuring it will have a low risk investment with steady returns over a long period of time.

Analysts suggest that if it is successful in a bid for Patrick, Macquarie will keep the stevedore's ports but pass the rest of the business to the other partners in a consortium.

Those parties are not yet known, but transport giant Linfox could be interested as well as Sir Richard Branson's Virgin group.

Patrick currently has a controlling stake in discount airline Virgin Blue, but if Macquarie took over, a deal could be thrashed out with Sir Richard.

ABN Amro analyst John Heagerty suggested Macquarie could end up spinning off Patrick's ports into one of its satellite infrastructure funds.

"I know that they are interested in ports as a fairly strong monopoly-style, privileged asset," Mr Heagerty said.

Mr Heagerty said the consortium arrangement in the Patrick offer would allow Macquarie to "acquire some other strategic partners for some of the other assets".

The deal could be similar to the way Macquarie acquired and broke up Norwegian explosives firm Dyno Nobel.

Dyno Nobel was acquired by Macquarie and a group of unidentified investors for $2.23 billion last September.

The group held on to Dyno Nobel's operations in Australia, New Zealand, Canada and the United States, floating the business on the Australian Stock Exchange last month after a $1.1 billion IPO.

It sold the remaining businesses to chemicals company Orica for $900 million.

Macquarie is also playing a role in one of the biggest infrastructure deals around, advising Spain's Ferrovial on a £8.7 billion ($A20.95 billion) bid for the world's largest airport operator, Britain's BAA, which owns Heathrow airport.

However Macquarie was unsuccessful in its STG1.5 billion ($A3.61 billion) bid for the prestigious London Stock Exchange earlier this year, after suffering a backlash from British press shocked at the audaciousness of an antipodean company trying to buy the prestigious institution.

Macquarie Bank will report its annual result on May 16 and has tipped its net profit to be "slightly up" on the record $823 million profit booked in 2004.