£150m Private Placement debt issue

HICL Infrastructure PLC

22 May 2023

 

22 May 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".)

£150m Private Placement debt issue

The Board of HICL is pleased to announce the successful Private Placement of £150m of loan notes ("the Notes") by its corporate subsidiary, Infrastructure Investments LP. Proceeds of the issue will be used to reduce the existing drawings¹ on the Group's Revolving Credit Facility ("RCF"). The Notes will convert the equivalent drawing on the RCF into a longer maturity and fix the all-in interest rate cost at a level below that currently payable on the RCF.

The issue has a weighted average interest rate of 5.75%, after hedging, and is comprised of two tranches: £100m, due in May 2033, and £50m, due in May 2035, with a blended coupon of 5.80%.

The Notes were purchased by Pension Insurance Corporation, Canada Life and Sun Life Capital Management ("Sun Life"), who acquired £50m of the Notes each. Sun Life is part of the same group as InfraRed, the Company's Investment Manager, and is therefore a related party for the purposes of Chapter 11 of the FCA's Listing Rules. The purchase of Notes by Sun Life constitutes a 'smaller related party transaction' pursuant to LR11.1.10R.

The maturity of the Notes was aligned with the forecast capital returns from HICL's PPP portfolio.

The Notes are an important lever to assist with diversifying the Company's available capital sources at a price that is expected to be accretive relative to its investment portfolio return, net of costs. In addition, the Board and Investment Manager continue to manage the Company's balance sheet conservatively and will look to reduce further the balance on the Company's RCF through accretive disposals, where appropriate.

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

"The Private Placement saw strong demand and was more than four times oversubscribed, reflecting the underlying strength of HICL's investment proposition. The Notes reduce HICL's interest rate and refinancing risks, provide additional flexibility and diversify HICL's sources of long-term capital."

¹ As at 19 May 2023 the balance on the RCF was £494m and excludes the proceeds from the notes, the upcoming receipt from the partial sale of Northwest Parkway and the expected investment in the Hornsea II OFTO. After completion of all these transactions, the Company is expected to have drawn c.£360m on its RCF.

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Enquiries 

InfraRed Capital Partners Limited                        [phone] / [e-mail] 

Edward Hunt 

Helen Price 

Mohammed Zaheer 

Teneo                                                               [phone] / [e-mail] 

Haya Herbert-Burns 

Matthew Thomlinson 

Investec Bank plc                                                 [phone] 

David Yovichic 

RBC Capital Markets                                           [phone] 

Matthew Coakes

Elizabeth Evans 

Aztec Financial Services (UK) Limited                [phone] 

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)  

InfraRed Capital Partners is an international infrastructure investment manager, with more than 180 professionals operating worldwide from offices in London, New York, Sydney and Seoul. Over the past 25 years, InfraRed has established itself as a highly successful developer and custodian of infrastructure assets that play a vital role in supporting communities. InfraRed manages US$14bn+ of equity capital¹ for investors around the globe, in listed and private funds across both income and capital gain strategies. 

A long-term sustainability-led mindset is integral to how InfraRed operates as it aims to achieve lasting, positive impacts and deliver on its vision of Creating Better Futures. InfraRed has been a signatory of the Principles of Responsible Investment since 2011 and has achieved the highest possible PRI rating² for its infrastructure business for seven consecutive assessments, having secured a 5 stars rating for the 2021 period. It is also a member of the Net Zero Asset Manager's Initiative and is a TCFD supporter. 

InfraRed is part of SLC Management, the institutional alternatives and traditional asset management business of Sun Life. InfraRed represents the infrastructure equity arm of SLC Management, which also incorporates BentallGreenOak, a global real estate investment management adviser, and Crescent Capital, a global alternative credit investment asset manager.  

www.ircp.com 

¹ Data as at Q3 2022. Equity Capital is calculated using a 5-year average FX rate 
² Principles for Responsible Investment ("PRI") ratings are based on following a set of Principles, including incorporating ESG issues into investment analysis, decision-making processes and ownership policies. More information is available at https://www.unpri.org/about-the-pri 

 

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