Acquisition

RNS Number : 6375W

International Public Partnership Ld

31 July 2009

 



31st July 2009

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

INTERNATIONAL PUBLIC PARTNERSHIPS LIMITED

(formerly known as Babcock & Brown Public Partnerships Limited)

Acquisition of an additional interest in Brescia Hospital

International Public Partnerships Limited ('the Company') is pleased to advise that it has secured an additional 13% interest in Brescia Hospital in Lombardy, Italy. The additional stake brings the Company's total interest in the project to 37% and represents an equal majority position alongside the local Italian shareholder, Fondaco. The purchase price of €1.04 million will be funded from the Company's existing cash balance.  Construction of the project was completed in 2004, and concession expiry is 2021.

The additional stake, acquired from Bovis Lend Lease under a pre-emptive option, has the effect of increasing the overall project IRR to the Company to c.9.3% (post acquisition fees and management expense), which is above the target level of return for the Company. In addition to the project being immediately accretive to the portfolio, it also meets the Company's other key investment criteria including:

• Project revenues linked to inflation (Italian RPI)

• Project revenues guaranteed by the Region of Lombardy

• Majority ownership and influence over project operations, including Board representation and control of the asset management function exclusively by the Company

• Debt facility in place, and 100% swapped for the life of the concession, ensuring no refinancing risk.

The project also generates approximately €300,000 in additional third-party revenue to shareholders, which comes from café and retail operations.  The project is overseen by Mike Leto, a member of the Company's 16-strong asset management team, who was responsible for the Company's initial investment in Brescia.

Giles Frost, Director of the Company said: 'The acquisition of an additional stake in Brescia Hospital illustrates the potential to acquire accretive opportunities in the current market environment. We will continue to review further Italian opportunities in partnership with Fondaco, whom we have successfully worked alongside since 2007.  In addition, Amber is currently reviewing a number of other opportunities for the benefit of the Company.  This is a very exciting time for the Company to acquire PPP assets at better prices than we have seen at any time since the Company listed in 2006.'

For further information, please contact:

Giles Frost                                  [phone]

Director

Media Enquiries:

Byron Ousey/Michael Turner        [phone]

Kreab Gavin Anderson

Notes to Editors:

International Public Partnerships Limited is a closed end investment company that invests in infrastructure assets in the UK, Europe and internationally, particularly those with a public or social character such as those developed with public bodies under private finance initiative (PFI) or public private partnership (PPP) procurement.  

The portfolio consists of 50 PPP/PFI projects with more than 99% of revenues backed by Governments. There is diversification geographically as well as across several PPP/PFI sectors, including roads and tunnels, railways, schools, courthouses, police and custodial facilities, government offices and health facilities. Average remaining concession life of projects in the portfolio is 25 years, against a weighted average debt tenor of 24 years, ensuring that project debt is largely matched to concession life. 

Amber Infrastructure Group has been responsible for the development and management of the majority of these assets and will continue to manage them for the benefit of INPP shareholders. 

The company listed on the Main Market of the London Stock Exchange in November 2006, and is a constituent of the FTSE 250 and FTSE AllShare. 

Disclaimer

Nothing in this press release is intended as an offer to sell or a solicitation of an offer to buy any securities. An investment in International Public Partnerships Limited (the 'Company') carries certain risks and past performance cannot be relied on as a guide to future performance.

 

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