Bilfinger Berger intends to introduce a publicly-listed fund in which it will place up to 19 public-private partnership projects from its current portfolio of 30 concessions.
These include road projects and social infrastructure projects across Europe, Canada and Australia. The assets in the fund will be predominantly operational and revenue generating. The Group has a total equity commitment of €161m (£140m) in the 19 project companies.
Shares in the new fund are intended to be listed on the premium segment of the London Stock Exchange with a placement volume of up to £245m. Shares in the fund will be offered for sale to institutional investors at a pre-determined price. Bilfinger Berger will commit to a strategic investment of at least 19.9% of the fund’s equity.
“In taking this step, our Concessions business segment is now utilizing a fund model for the transfer of an entire portfolio, following the successful sale of several individual projects in the past,” said chairman of the executive board of Bilfinger Berger, Roland Koch. “We believe that an infrastructure fund, especially in the current critical capital markets situation, is highly attractive for institutional investors thanks to its international reach, the creditworthiness of its project clients and its expected returns.” According to Koch, the Group intends to make further investments with the proceeds. The Group’s target for equity committed to public-private partnerships remains unchanged at €400m.
Publication of the prospectus for the fund is planned for October with a listing to follow in November 2011. The sale of the projects to the fund is expected to take effect in the first quarter of 2012 and will lead to net proceeds of up to €270m for Bilfinger Berger of which a minimum of €55m will be reinvested in the fund. The anticipated capital gain, depending on exchange rate development and other factors, will be in the magnitude of up to €50m, according to the company.
Bilfinger Berger currently has a number of new projects in the bidding phase in its core markets. Through a cooperation agreement, the Group will offer additional mature projects to the fund. Bilfinger Berger will continue asset management for the project companies included in the fund.
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