Proposed Issue of Equity

RNS Number : 6199R

International Public Partnership Ld

12 December 2016

 

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT FOR PUBLICATION, RELEASE, OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN, OR INTO, THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL OR TO U.S. PERSONS. THE INFORMATION CONTAINED HEREIN DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER TO ISSUE OR SELL, OR ANY SOLICITATION OF ANY OFFER TO SUBSCRIBE OR PURCHASE, ANY INVESTMENTS IN ANY JURISDICTION.

12 December 2016

International Public Partnerships Limited

Proposed Issue of Equity

The Board of Directors (the "Board") of International Public Partnerships Limited (the "Company" and/or "INPP") is pleased to announce that the Company proposes to raise £50 to £75 million (before costs) through the issue of ordinary shares of 0.01p in the capital of the Company (the "New Ordinary Shares") by way of tap issuance (the "Issue"). The Issue will be made to qualifying investors* through the Company's corporate broker, Numis Securities Limited ("Numis").

The Company announced on 8 December 2016 that it is part of a consortium that has contracted to acquire a 61% interest in National Grid's gas distribution network ('GDN') and that the Company expects to invest up to £275 million in that transaction which is anticipated to reach financial close towards the end of Q1 2017 (subject to the satisfaction of certain conditions).

On 23 November 2016 and in anticipation of the possibility of the GDN opportunity, the Company announced that its corporate revolving debt facility had been renewed and increased in size to £400 million. Taken together with the current drawn balance of £33 million, the commitment to invest up to £275 million in the GDN and other investment commitments of the Company (such as the Thames Tideway Tunnel) amounting to approximately £122 million,  the Company has prospectively fully utilised the capacity of its revolving credit facility.

The Company continues to review and consider its options with regard to capital raising in the longer term and will consider whether it is in the interests of shareholders for the Company to consider a more significant capital raising event in 2017 in order to reduce the level of utilisation of the revolving credit facility and free this up to support future investment opportunities.

In the meantime however the Company considers that it is in the interests of shareholders for a more modest capital raising event to take place.  Without such an event, while the Company has the resources to meet its pipeline of existing investment commitments, it has only very limited additional resource available to it to apply to any new opportunities that may present themselves over the next few months.  

The Company is regularly presented with investment opportunities through the origination activities of its investment adviser, Amber Fund Management Limited, and believes that it is in the best interests of the Company to continue to have access to capital resource so that it is able to respond to such opportunities where the directors believe that those opportunities offer value to investors.

Currently, for instance, in addition to GDN and the other forward investment commitments that the Company has funded through its existing revolving credit facility, the Company has a strong pipeline of potential short and medium term opportunities including additional investment within the UK offshore transmission sector, investments in broadband infrastructure and a number of other projects in the UK, Europe, Australia and the United States that the Company or its Investment Adviser are bidding on or developing.

The net proceeds of the proposed issue will therefore be used firstly, to reduce the drawn element of the Company's debt facility, secondly to meet forthcoming investment commitments of the Company and thirdly to meet new opportunities that the Board determines to be in the best interests of the Company .   The sizing of this capital issue has been determined to allow the Company to meet these objectives but to limit the risk of holding unnecessary amounts of uninvested cash on the Company's balance sheet.

The Issue will be non pre-emptive and will be launched immediately following this announcement, when Numis will commence a bookbuilding process to determine the level of demand from potential investors for participation in the Issue. The number of New Ordinary Shares to be issued and the price per New Ordinary Share (the "Strike Price") will be agreed between Numis and the Company following close of the bookbuild at noon on 16 December, and announced shortly thereafter.  Numis and the Company reserve the right to set a maximum percentage of New Ordinary Shares that may be allocated to any one investor.

As noted above the Board believes that it is possible that the Company will determine to make an additional issue of new capital at some later date in 2017. In the event that the Board does so determine and subject to all necessary regulatory consents and waivers being obtained, the Board would expect to exercise their discretion such that, in the event of any such future issue in 2017 being over-subscribed, long-term, supportive investors who are allocated shares in this bookbuild will, if so desired and subject to the terms of such issue, at a minimum be preferentially allocated twice as many shares in such fund raising as they are allocated in this one.

The New Ordinary Shares are not being offered at a fixed price. To bid in the bookbuild, investors will need to communicate their bid (or bids) by telephone to their usual sales contact at Numis.  Each telephone bid should state the number of New Ordinary Shares for which the prospective investor wishes to subscribe and the price or price range that the prospective investor is offering to pay; any bid price must be for a full pence or half pence amount. The Strike Price will be in excess of the Company's prevailing net asset value per Ordinary Share.

The bookbuild is expected to close at 12 noon (London time) on 16 December 2016 but may be closed earlier or later at the discretion of the Company and Numis. Numis may, in agreement with the Company, accept bids that are received after the bookbuild has closed.

Subject to the above, Numis may choose to accept bids, either in whole or in part, on the basis of allocations determined in agreement with the Company, and may scale down any bids for this purpose on such basis as the Company and Numis may determine. Numis may also, notwithstanding the above, subject to the prior consent of the Company: (i) allocate New Ordinary Shares after the time of any initial allocation to any person submitting a bid after that time, and (ii) allocate New Ordinary Shares after the bookbuild has closed to any person submitting a bid after that time. The Company reserves the right to reduce the amount to be raised pursuant to the Issue.

Under the terms of the Issue, INPP has the ability to issue up to a maximum of 99,260,331 New Ordinary Shares on a non pre-emptive basis, under authority granted by Shareholders at its Annual General Meeting in June 2016. The Board does not intend to increase the total funds raised above £75 million.

* As defined in section 86(7) of the Financial Services and Markets Act 2000 (as amended).

Certain information contained in this announcement would have constituted inside information (as defined by Article 7 of Regulation (EU) No 596/2014) prior to its release as part of this announcement.

For further information:

Erica Sibree                                                                                                        

Amber Fund Management Limited                                                          

[phone]

Nick Westlake / Hugh Jonathan

Numis Securities Limited          

[phone]

Ed Berry/Mitch Barltrop                                                          

FTI Consulting

[phone]/1039

IMPORTANT NOTICES

This Announcement has been issued by and is the sole responsibility of the Company.

No representation or warranty express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Numis or by any of its respective affiliates or agents as to or in relation to, the accuracy or completeness of this Announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.

Neither this Announcement nor anything contained herein shall form the basis of, or be relied upon in connection with, any offer or commitment whatsoever in any jurisdiction.

This Announcement and the information contained herein is not for publication, release or distribution, directly or indirectly, in or into the United States, Australia, Canada, Japan or South Africa or any jurisdiction in which the same would be unlawful. This Announcement does not constitute an offer to sell or issue or the solicitation of an offer to buy or acquire shares in the capital of the Company.

The Shares have not been, or will not be, registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or with any securities regulatory authority of any State or other jurisdiction of the United States, and accordingly may not be offered, sold or transferred within the United States except pursuant to an exemption from, or in a transaction not subject to, registration under the Securities Act. No offering of the Shares is being made in the United States or to U.S. persons as defined in and in accordance with Regulation S under the Securities Act ("U.S. Persons"). The Company has not been and will not be registered under the U.S. Investment Company Act of 1940, as amended (the "Investment Company Act") and investors will not be entitled to the benefits of that Act.

The Company is a non-EU AIF for the purposes of the Alternative Investment Fund Managers Directive ("AIFMD") and has not applied for permission to market New Ordinary Shares in any jurisdiction other than the United Kingdom and Ireland.  Investors will, by bidding for New Ordinary Shares, be deemed to have represented that it is lawful for them to have made such a bid and to hold New Ordinary Shares and that where required by AIFMD, they have read the information made available by the Company under Article 23 of AIFMD. The additional regulatory disclosures made by the Company under Article 23 of AIFMD can be found on the INPP website at www.internationalpublicpartnerships.com/investor-information/other-publications.

Numis, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting for the Company and is acting for no-one else in connection with the Issue and will not be responsible to anyone other than the Company for providing the protections afforded to its clients nor for providing advice in relation to the proposed issue or any other matter referred to herein. To the fullest extent permitted by law recipients agree that Numis shall not have any liability (direct or indirect) for or in connection with this Announcement or any matters arising out of or in connection herewith. Numis has not authorised the contents of, or any part of, this document.

This Announcement is for information purposes only and does not constitute an invitation to subscribe for or otherwise acquire or dispose of securities in the Company in any jurisdiction. The information contained in this Announcement is for background purposes only and does not purport to be full or complete. This Announcement does not constitute or form part of any offer to issue or sell, or any solicitation of any offer to subscribe or purchase, any investments in any jurisdiction nor shall it (or the fact of its distribution) form the basis of, or be relied on in connection with, any contract therefor.

 

END

 

 

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