Following a strategic review of its projects portfolio, 3i Infrastructure has agreed to sell the UK Projects portfolio to various buyers including funds managed by Dalmore, Semperian and Innisfree. Proceeds to 3i Infrastructure will be GBP194m.
The strategic review followed the completion of the construction phase for all projects in the portfolio. The UK Projects being sold comprise stakes in Ayrshire College, Elgin (a vehicle holding 16 project investments), Mersey Gateway Bridge, Octagon Hospital, the West of Duddon Sands offshore transmission owner project, as well as an interest in the Dalmore Capital Fund. Completion is expected to take place before the end of the financial year.
Separately, 3i Infrastructure is also exploring the potential sale of the European assets in its projects portfolio. The remainder of the company’s portfolio would then consist entirely of investments in economic infrastructure businesses.
A spokesperson for investment manager 3i Group has confirmed to Partnerships Bulletin the strategy for the 3i European Operational Projects Fund (a separate fund to 3i Infrastructure) remains unchanged.
In October that fund agreed to invest EUR70m for the acquisition of an 80% stake in Sociedad Concesionaría Autovía Gerediaga Elorrio, S.A. (AGESA), the project company for the Gerediaga – Elorrio motorway PPP in Spain. That investment followed acquisitions in Portugal, Italy, Ireland and Germany announced in April.
Richard Laing, Chair of 3i Infrastructure, commented: “Our review of the role of operational projects in our portfolio concluded that it was in the best interests of shareholders to sell these assets and realise the value uplift now that they have all entered stable operations. We consider that the prices achieved are attractive.”
Phil White, Managing Partner and Head of Infrastructure, 3i Investments, added: “Holding these assets at the sales price achieved would be dilutive to the Company’s returns and although the UK Projects provide good income, strong growth in income from our economic infrastructure portfolio underpins confidence that we will continue to deliver our progressive dividend objective.”
Meanwhile, International Public Partnerships (INPP) has announced an issue of equity has closed today raising GBP75m through the issue of 48,598,631 ordinary shares of 0.01p by way of tap issuance.
Michael Gerrard, Chairman of INPP, said: "The support from new and existing shareholders is a testament to the quality and diversification of the Company's investment pipeline and the strength of our existing portfolio, which underpin the generation of robust, long-term inflation-linked returns. The proceeds from this capital raising will be used to repay our corporate debt facility and so help us prepare for new investment opportunities in 2020."