LONDON, UK: HICL Infrastructure Plc has acquired, indirectly, a 33.3% interest in Road Management Group (RMG), a holding company which comprises two UK shadow toll roads: the A417/A419 Swindon-Gloucester and the A1 (M) Alconbury-Peterborough.
The interest was acquired from Abertis Infraestructuras S.A. for a combined consideration of up to £34.4 million. This investment will be funded by HICL’s Revolving Credit Facility.
The Projects are both 30-year shadow toll PFI concessions for the design, construction, financing, operation, and maintenance of the roads, which reached Financial Close in March 1996 and construction completion in 1998.
The client is National Highways and operation and maintenance of both roads is undertaken by Ringway Limited, a subsidiary of Vinci Group. These roads are strategically located and benefit from extensive traffic history which significantly de-risks the variable component of revenue.
Both roads have performed resiliently through the Covid-19 pandemic and are well positioned for further recovery. Following this acquisition, the proportion of demand-based assets in the portfolio with correlation to GDP remains below 20%.
Edward Hunt, Director at InfraRed said: “We are delighted to be acquiring a stake in two high quality UK road projects which provide critical transport links to their respective communities. Both projects have predictable revenues, have been acquired on an ungeared basis and are expected to be accretive to portfolio yield and total return.”
HICL Infrastructure PLC (HICL) is a long-term investor in infrastructure assets which are predominantly operational and yielding steady returns. It was the first infrastructure investment company to be listed on the London Stock Exchange.
With a current portfolio of over 100 infrastructure investments, HICL is seeking further suitable opportunities in core infrastructure, which are inherently positioned at the lower end of the risk spectrum. www.hicl.com
The Investment Manager to HICL is InfraRed Capital Partners Limited which has successfully invested in over 200 infrastructure projects since 1997. InfraRed is a leading international investment manager focused on infrastructure and real estate. It operates worldwide from offices in London, New York, Mexico City, Seoul and Sydney. With over 170 professionals, it manages equity capital in multiple private and listed funds, primarily for institutional investors across the globe. InfraRed is authorised and regulated by the Financial Conduct Authority. www.ircp.com.