Partial Disposal of FHSP
PARTIAL DISPOSAL OF FHSP
c.£30 million of proceeds raised from a partial disposal of its Family Housing for Service Personnel ('FHSP') investment
27 September 2024
International Public Partnerships Limited, the listed infrastructure investment company ('INPP' or the 'Company'), is pleased to announce a partial disposal of its FHSP investment, realising c.£30 million, with the sale price being in line with the Company's 30 June 2024 valuation[i].
INPP's FHSP investments are in the form of mezzanine debt investments secured against seven operational Public-Private Partnerships ('P3') projects, comprising c.21,800 housing units located across the United States.
The disposal has been made in accordance with the Company's stated capital allocation strategy which includes maintaining a targeted programme of divestments. The FHSP investments realised were identified as a disposal target by the Company as part of its ongoing assessment of its portfolio. The transaction will allow the proceeds to be reallocated towards its existing share buyback programme as well as its near-term investment commitments.
The FHSP investments that the Company continues to hold were valued at c.£73 million as at 30 June 2024.
In addition, the disposal supports the Board of Directors' confidence in the Company's portfolio valuation and belief that optimising the portfolio and reallocating capital should have a positive impact on the discount at which the Company's shares are trading relative to their net asset value ('NAV').
Mike Gerrard, Chair of INPP, said: "We are pleased to report that the Company has successfully realised a further c.£30 million from divestment activity. This takes realised proceeds over the last 18 months to over £260 million representing c.10% of the portfolio (by investment at fair value) across digital infrastructure, social infrastructure and energy transmission sectors in the UK and North America. All realisation activity has been in line with, or slightly above, the most recently published valuations".
Approach to capital allocation and discount management
The Company restates that it will continue to maintain a disciplined approach to capital allocation, guided by the following three principles, to ensure the Company is as well positioned as possible in the current market:
1. Prudent use of the Company's corporate debt facility ('CDF');
2. Maintain a targeted programme of divestments to both demonstrate value and reallocate capital; and
3. Allocate divestment proceeds towards both, (i) increasing the share buyback programme, and (ii) subject to the economics being more attractive over the medium to long-term relative to the opportunity to engage in a share buyback, making new, accretive investments.
There are currently no cash drawings under the Company's £250 million CDF. The Company's existing share buyback programme and its near-term investment commitments are expected to be funded using a combination of existing cash reserves as well as through additional cash expected to be generated in the near-term.
Share buyback programme
To date, c.£22.5 million has been used to buy the Company's shares under the buyback programme, which has recently been extended to up to £60 million in size and is currently expected to run until 31 March 2025. Shares will continue to be bought under the programme whilst they trade at a significant discount to their NAV.
Investment commitments
The Company has investment commitments totalling c.£35 million across the transport (Gold Coast Light Rail - Stage 3 and the recently announced further investment in BeNEX), education (Flinders University Health and Medical Research Building) and digital (toob) sectors. It is currently expected that the majority of these amounts will be invested over the period to 31 December 2025.
ENDS.
For further information:
Erica Sibree/Amy Edwards +44 (0) 7557 676 499 / (0) 7827 238 355
Amber Fund Management Limited
Hugh Jonathan +44 (0)20 7260 1263
Numis Securities
Ed Berry/Mitch Barltrop +44 (0) 7703 330 199 / (0) 7807 296 032
FTI Consulting
About International Public Partnerships:
INPP is a listed infrastructure investment company that invests in global public infrastructure projects and businesses, which meets societal and environmental needs, both now, and into the future.
INPP is a responsible, long-term investor in over 140 infrastructure projects and businesses. The portfolio consists of utility and transmission, transport, education, health, justice and digital infrastructure projects and businesses, in the UK, Europe, Australia and North America. INPP seeks to provide its shareholders with both a long-term yield and capital growth.
Amber Infrastructure Group ('Amber') is the Investment Adviser to INPP and consists of over 180 staff who are responsible for the management of, advice on and origination of infrastructure investments.
[i] Note that the sales price was not known at the time of determining the 30 June 2024 valuation.
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