HICL Infrastructure

18 September 2023

HICL Infrastructure PLC

"HICL" or "the Company" and, together with its subsidiaries, "the Group", the London-listed infrastructure investment company managed by InfraRed Capital Partners Limited ("InfraRed" or "the Investment Manager".)

Disposal of Bradford Schools PPPs for c. £37m

·    Sale represents an 8% premium to the Company's valuation at 31 March 2023

·    Transaction is accretive to key portfolio metrics and improves portfolio composition

·    Continues HICL's track record of delivering capital growth through active asset recycling

The Board is pleased to announce that HICL has entered into an agreement to dispose of its entire equity interests in the Bradford Building Schools for the Future ("BSF") Phase 1 ("Bradford 1") and Bradford BSF Phase 2 PFI projects ("Bradford 2") (together the "Projects") for a total consideration of c. £37m. Together with refinancing proceeds received since 31 March 2023, the sale represents an 8% premium to the Company's last audited valuation at 31 March 2023. Completion is expected in Q4 2023, subject to customary closing conditions.

HICL initially invested in Bradford 1 in June 2014, and in Bradford 2 in June 2009, acquiring additional stakes in the Projects in 2021 through execution of pre-emption rights. The sale price represents an annualised holding period return for HICL of 11.5% and 14.1%, respectively. This transaction improves portfolio composition, enhancing key portfolio metrics including total return, inflation correlation and asset life, and further enhances HICL's track record of utilising selective asset realisations to deliver capital growth and market test asset valuations.

Through its ownership, HICL has delivered enhanced community outcomes while creating value for shareholders. InfraRed actively managed Bradford 2 through its construction phase and supported the refinancing of the project in April 2023, sharing outperformance with the Local Authority. HICL has also supported the delivery of key operational variations including the addition of 50 Special Educational Needs and Disabilities places annually for the local community.  

Proceeds from the transaction will reduce the drawn balance on the Company's Revolving Credit Facility ("RCF"). Following completion of the disposal, drawings on the RCF are expected to be c. £330m.

Edward Hunt, Head of Core Income Funds at InfraRed said:

"Selective divestments enhance portfolio composition, provide a valuable source of funding beyond capital markets, and reinforce the value of HICL's high quality portfolio. This transaction builds on HICL's long track record of delivering value enhancement through active asset recycling, and we continue to progress disposal opportunities where these deliver shareholder value."

-Ends-

Enquiries

InfraRed Capital Partners Limited                            +44 (0) 20 7484 1800 / [email protected]

Edward Hunt

Helen Price

Mohammed Zaheer

Brunswick                                                           +44 (0) 20 7404 5959 / [email protected]

Sofie Brewis

Investec Bank plc                                                             +44(0) 20 7597 4952

David Yovichic

RBC Capital Markets                                                       +44 (0) 20 7653 4000

Matthew Coakes

Elizabeth Evans

Aztec Financial Services (UK) Limited                    +44(0) 203 818 0246

Chris Copperwaite

Sarah Felmingham

HICL Infrastructure PLC

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.

Further details can be found on the HICL website www.hicl.com.

Investment Manager (InfraRed Capital Partners)

The Investment Manager to HICL is InfraRed Capital Partners Limited ("InfraRed") which has successfully invested in infrastructure projects since 1997. InfraRed is a leading international investment manager, operating worldwide from offices in London, New York, Seoul and Sydney and managing 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.

The infrastructure investment team at InfraRed consists of over 100 investment professionals, all with an infrastructure investment background and a broad range of relevant skills, including private equity, structured finance, construction, renewable energy and facilities management.

InfraRed implements best-in-class practices to underpin asset management and investment decisions, promotes ethical behaviour and has established community engagement initiatives to support good causes in the wider community. InfraRed is a signatory of the Principles of Responsible Investment.

Further details can be found on InfraRed's website www.ircp.com.