HICL Infrastructure Company Limited – Disposal of an Investment

4 April 2019 Investments
HICL Infrastructure Company Limited (“HICL” or the “Company”, and together with its subsidiaries the “Group”) announces that the Group has sold its 56% equity and subordinated debt interest in the Colchester Garrison MoD Project (“Colchester”) to subsidiaries of Allianz Group, the PPP Equity PIP limited partnership, and Dalmore Capital Fund II limited partnership (both partnerships managed by Dalmore Capital Limited).

The decision to sell was taken following the recent disposal by a co-shareholder of its holding in Colchester. This disposal was undertaken by way of a competitive tender process, and it provided a benchmark value for the Company’s interest in Colchester which the Board considered to be significantly ahead of the value that could be achieved by retaining the project. The Board will always consider and evaluate potential disposals which are in the best interests of shareholders.

The sale of the Group’s holding in Colchester constitutes the contracted disposal to which reference was made, on a no-names basis, in the Company’s interim results in November of last year.

The profit on disposal, after costs, is £21.7m over the Directors’ valuation of £86.6m as at 30 September 2014.  After repaying the Group’s revolving debt facility, drawn to make investments since 30 September 2014 (as previously reported), the Group currently holds approximately £25m of cash which is available for new investment opportunities.

The Company intends to update the market in February with respect to current portfolio performance, market dynamics and trends in market valuations for infrastructure assets of the type owned by the Group.

Tony Roper, Director, InfraRed Capital Partners Limited said:

“Following receipt of very attractive offers for this asset, the Board concluded that, rather than exercise the Group’s pre-emption rights, it was in shareholders’ best interests to sell and re-invest the proceeds. We continue to evaluate a pipeline of suitable investment opportunities and are confident of being able to re-invest this capital.”

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