HICL Infrastructure Company Limited – Conditional Acquisition of a new US$166m investment

4 April 2019 Investments
HICL Infrastructure Company Limited (“HICL” or the “Company”), the listed infrastructure investment company advised by InfraRed Capital Partners Limited (“InfraRed”), is pleased to announce that it has reached an agreement to acquire a 33.3% equity interest in Northwest Parkway (the “Project”), a toll-road located in the Denver metropolitan area of Colorado, U.S.A.  HICL is part of a consortium alongside DIF Infrastructure IV and Northleaf Capital Partners, which has agreed to acquire a 100% equity interest in the Project from Brisa, a Portuguese toll-road operator.

The Project is a 99-year concession, signed in 2007, to operate and maintain a 14km section of the beltway system extending around Denver.  The Project has good traffic history as the road was opened in 2003 and connects with several toll and non-toll highways, including E-470, I-25, U.S. 36 and U.S. 287, providing convenient access to residential and commercial centres in the region.  Project revenues are generated by tolls through an all-electronic tolling system.  The counterparty to the concession is the Northwest Parkway Public Highway Authority.

Completion is subject to a limited number of conditions and is expected in the first half of 2017.  HICL’s share of the consideration is approximately US$166 million, which will be paid at completion, funded by cash and drawing under the Group’s enlarged revolving debt facility. With completion of the acquisition not due until the first half of 2017, the HICL Group’s funding surplus of approximately £11m remains unchanged.

Tony Roper, Director, InfraRed Capital Partners Limited, said:

“We are delighted to have signed the agreement to acquire a substantial interest in the Northwest Parkway toll-road, which is strategically located in a dynamic region of Colorado, forming part of the ring road around Denver.  When it completes, this will be HICL’s first investment in the USA.

The Project is consistent with the stated strategy and supports HICL’s disciplined investment proposition, which is to produce long-term income for shareholders from a portfolio of infrastructure investments that is positioned at the lower end of the risk spectrum.  The Company’s acquisition strategy targets suitable opportunities in three market segments, including demand-based assets like Northwest Parkway.  With a 90-year concession life remaining and strong inflation-linkage, this asset is well-placed to deliver attractive returns.”

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