Acquisition of majority position in Lewisham BSF
20 April 2015
INPP acquires majority position in Lewisham Building Schools for the Future (BSF) portfolio
International Public Partnerships Limited (the Company, INPP) is pleased to announce that it has acquired an additional 40% investment in the Lewisham Building Schools for the Future (BSF) project, increasing the Company's overall exposure to between 40% and 50% in the underlying BSF assets.
The Company will invest £14.3 million for the additional 40% interest from Babcock Project Investments Limited. The Lewisham project comprises four BSF schools located in the South East London borough, including Sedgehill and Conisborough Schools; Trinity School; Deptford Green School; and, Bonus Pastor, Pendergast and Drum Beat Schools.
The opportunity to acquire the interest in the project has arisen through pre-emptive rights that the Company gained as part of its 100% stake in Building Schools for the Future Investment (BSFI), which it acquired from the Department of Education and Partnerships UK in August 2011.
Following the acquisition, INPP will hold a 50% interest in three of the underlying BSF assets and 40% in the fourth (as above). The Costain Pension Fund and Lewisham Borough Council will continue to hold the remaining interests in the project. The acquisition will be funded through the Company's corporate debt facility, which will be c.£41 million drawn following the investment.
Like the other BSF projects in which the Company invests, the current investment meets INPP's investment criteria, namely:
· The underlying project debt is non-recourse at the project level and matched to the life of the project;
· The underlying assets have a long operational pipeline, with a remaining operational term of 23 years;
· The assets conform to the typical UK BSF PFI project funding structure with a well established and standard form risk framework;
· The projects are operational and yielding, and will contribute to INPP's portfolio return immediately upon acquisition.
The investment has been completed at a level of projected return that the Company regards as attractive and demonstrates the value of the pre-emption rights it acquired as part of the original BSFI investment.
Rupert Dorey, Chairman of International Public Partnerships, said: "INPP is pleased to have acquired this additional interest in the Lewisham BSF project, enhancing its overall exposure to the Lewisham schools. The transaction is further evidence of the value that the original BSFI transaction has brought to the portfolio, particularly through the pre-emptive positions that continue to be available to the 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 this new interest compliments the existing portfolio of over 200 individual schools across the UK. In total, school projects now represent c.25% of the net asset value (NAV) of the Company.
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/Mitch Barltrop +44 (0)20 3727 1046 / 1039
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 112 social and transport infrastructure projects, including schools, hospitals, courts, police headquarters, transport and utility and transmission projects in the U.K., Europe, Australia and Canada. INPP seeks to provide its shareholders with both a long-term yield and capital growth through investment across both construction and operational phases of 20-40 year concessions.
Amber Infrastructure Group (Amber) is the Investment Advisor to INPP and consists of over 85 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
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