CANADA - The C$41bn Ontario Municipal Employees' Retirement System (OMERS) has bolstered both its real estate and infrastructure portfolios with the purchase of seven hotels and laboratory services firm MDS Diagnostic Services.
OMERS' real estate investment arm, $6bn Oxford Properties, purchased the hotels from Fairmont Hotels and Resorts - who will continue to manage the properties - for an undisclosed fee.
The fund also announced that its infrastructure arm, $3bn Borealis, had entered into an agreement to purchase MDS Diagnostic Services, Canada’s largest provider of laboratory services.
According tom OMERS, MDS Diagnostic Services has annual revenues of $335m.
Paul Haggis, President and CEO of OMERS said of the deal: “These assets provide stable, long-term returns to help us meet our pension obligations."
The deal forms part of the fund's aggressive strategy to increase its infrastructure holdings from 5.7% of total assets to 15%. According to the fund, a shift in asset mix toward such private market investments would provide strong, stable cash flows to help OMERS meet its long-term commitment to pay current and future pensions.
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This week's edition of Professional Pensions is out now
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