John Laing Infrastructure Fund Limited Acquires Iridium
JLIF, the FTSE 250 listed infrastructure investment company, is pleased to announce that it has entered into an agreement with Iridium Concesiones de Infraestructuras, a subsidiary of Grupo ACS, to acquire an effective 40% stake in the Barcelona Line 9 Section II metro project. Line 9 runs directly through the heart of the city centre, connecting the airport and the port district.
The consideration for the acquisition, which is expected to complete over the coming weeks (subject to the customary consents) is approximately £85 million and will be funded through JLIF's £180 million multi-currency revolving credit facility.
The transaction represents JLIF's first investment in the Spanish PPP market and, when completed, will bring the total number of assets in JLIF's portfolio to 58.
The project does not retain any construction risk and full availability payments are being received from the client. Despite several of the 15 stations currently being in construction through separate agreements, the delivery risk does not sit within JLIF's investment. The client, IFERCAT, is a public agency of the Catalonian Government, whose payments are backed by the Region of Catalonia, which is financially supported by the Spanish Central Government.
The concession has more than 27 years remaining, which provides JLIF with a significant long term source of income. Iridium, one of the world's leading infrastructure companies, will remain involved in the project, both as an equity participant and as a service provider.
The discount rate applied to the forecast asset cash flows being acquired is materially above the weighted average discount rate used to value JLIF's portfolio at 30 June 2015.
Andrew Charlesworth from John Laing Capital Management ("JLCM"), Investment Adviser to JLIF, said:
"JLIF's ability to undertake a thorough due diligence process in an accelerated timeframe and the flexibility offered by its new £180 million revolving credit facility were instrumental in the success of this transaction. I would like to thank Iridium for its efforts in helping this transaction progress efficiently. On behalf of JLIF, I look forward to developing our relationship through our work on this project and hopefully other similar opportunities in the future."
JLIF is one of Europe's largest listed infrastructure funds, trading on the London Stock Exchange. As an equity stakeholder, JLIF partners with public sector counterparties across the world to deliver key local and national infrastructure projects. In return these provide government-backed, inflation-linked revenue streams to our business. JLIF's continued success is built on a collaborative approach, centred on long term relationships with its clients such that their changing infrastructure needs can be met in a timely and cost effective way.