International PP to raise £80m to pay down debt
International Public Partnerships has begun to raise £80m to pay down debt after its recent investments in Australian rolling stock and ahead of further spending on UK offshore electricity transmission.
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After the £88m investment in Australia's Reliance Rail public-private partnership, the FTSE 250-listed investment group will be roughly £80m drawn on the cash component of its corporate debt facility.
By the end of December, managers plan to draw around a further £14m to fulfil commitments to invest into the Victoria schools, Gold Coast light railway and the Thames Tideway tunnel projects.
After winning its bid to operate the transmission cable connection to the Dudgeon wind farm offshore Norfolk, the company expects to invest around £50m on closing the deal in the second quarter of 2018.
"Given the investments and investment opportunities noted above, the company believes that it is appropriate to consider raising further equity capital in order to pay down the drawn corporate debt facility," the company said on Wednesday, adding that "excess demand" could see broker Numis Securities raise a total of £94m.
"The company remains strongly positive about its prospects regarding both the performance of its existing investments and the opportunity to add high-quality investments to the portfolio in the short-to-medium term."
Numis began the bookbuilding process on Wednesday morning and will determine the number of new shares to be issued and the price with the company following close of the bookbuild at noon on 5 December.