International Public Partnership Ld Acquisition of Ten BSF Interests (0552D)
July 01 2016 - 12:03PM
UK Regulatory
TIDMINPP
RNS Number : 0552D
International Public Partnership Ld
01 July 2016
1 July 2016
INPP acquires ten Building Schools for the Future (BSF)
interests
International Public Partnerships Limited ("INPP" or the
"Company") is pleased to announce that it has agreed to acquire ten
Building Schools for the Future ("BSF") investments from Balfour
Beatty, marking a significant evolution in the Company's allocation
to education infrastructure. The transaction will transform INPP
into a majority investor in BSF, the investment delivery vehicle
designed to refurbish secondary schools across the UK.
INPP will commit up to GBP72.6 million to the transaction to
acquire investment interests in a total of 14 UK schools. The
investment opportunity was secured through pre-emption rights that
INPP gained as part of its ownership of Building Schools for the
Future Investments LLP ("BSFI"). INPP acquired BSFI from the
Department of Education and Partnerships UK in August 2011.
Owing to its established position in UK education
infrastructure, INPP already holds 10% interests in seven of the
Balfour Beatty's investments in question, and as a result
completion of the transaction will increase its stake to 90% in
each scheme post-acquisition. INPP will at the same time acquire
new interests in a further three BSF schemes previously under
Balfour Beatty's ownership.
The transactions are subject to certain formal rights for the
respective local authority partners to also acquire investment
interests in these BSF projects which if exercised would reduce the
size of investment to be made by INPP. Such rights if exercised
must be exercised within a strict timescale and the Company's
current expectation is that it is unlikely that such rights will be
taken up.
Like the other BSF projects in which INPP invests, the current
investment meets INPP's investment criteria:
-- The projects have long operational lives with a remaining
operational term of on average, 21 years;
-- The investments conform to the typical UK BSF PFI project
funding structure with a well established and standard form risk
framework;
-- The underlying projects are operational and yielding and will
contribute to INPP's portfolio return immediately upon
acquisition.
-- The investments' debt is non-recourse at the project level
and matched to the life of the project;
The price for the investment has been completed at a level that
offers a projected return that INPP regards as attractive for its
investors in current market conditions.
The investment is eligible to be funded through the Company's
debt facility. Following financial close of the acquisition and
draw down under the facility the Company will be approximately
GBP96.3 million drawn against its GBP300 million revolving
corporate debt facility. In addition it has drawn c.GBP140.6
million by way of letters of credit to support its future
investment obligations into new projects including its investment
commitments to the Tideway project. The Company continues to review
its options with respect to capital funding.
Rupert Dorey, Chairman of International Public Partnerships,
said: "INPP has cemented its leading position in long-term
investment into UK PFI schools. Through the Company's majority
stake in the Buildings Schools for Future portfolio, we have
enhanced our education portfolio to cover over 247 schools. This
reflects our commitment to sourcing assets where we can create,
deliver and safeguard maximum value for investors in our
Company."
About the BSF portfolio
The BSF programme was an initiative launched in 2004 by the
previous government with the aim of rebuilding or re-modelling
every secondary school in England over a 20 year period. Although
the longer term BSF programme has now been replaced, the schools
which were the subject of the original programme continue to be
actively developed and managed.
INPP originally invested into the BSF programme when it acquired
the government's interest in the BSFI in August 2011. Since this
time, the Company has built up considerable experience in managing
investments in schools delivered under PFI and PPP programmes, and
the acquisition of new interests complement the existing portfolio
of over 200 individual schools across the UK. Following this
acquisition, school projects now represent c.26% of the Company's
investment fair value (taking into account transactions since 31
December 2015).
For further information:
Erica Sibree +44 (0)20 7939 0558
Amber Fund Management Limited
Nick Westlake/Hugh Jonathan +44 (0)20 7260 1345/1263
Numis Securities
Ed Berry +44 (0)20 3 727 1046
FTI Consulting
Notes to Editors:
About International Public Partnerships (INPP):
International Public Partnerships ('INPP') is a listed
infrastructure investment company which invests in global public
infrastructure projects developed under the public private
partnerships ('PPP'), private finance initiative ('PFI'), regulated
asset and other similar procurement methods.
Listed in 2006, INPP is a long-term investor in 122 social and
transport infrastructure projects, including schools, hospitals,
courts, police headquarters, transport, utility and transmission
projects in the U.K., Europe, Australia and North America. INPP
seeks to provide its shareholders with both a long-term yield and
capital growth through investment across both construction and
operational phases typically of 25-40 year concessions.
Amber Infrastructure Group ('Amber') is the Investment Advisor
to INPP and consists around 90 dedicated staff who manage, advise
on and originate projects for INPP.
Visit the INPP website at
www.internationalpublicpartnerships.com for more information.
This information is provided by RNS
The company news service from the London Stock Exchange
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