UK-listed infrastructure investor, HSBC Infrastructure Company, has signed a binding conditional agreement to acquire an interest in two UK private finance initiative (PFI) and in two Canadian public/private partnership (PPP) projects from subsidiaries of Bilfinger Berger.
The total cost of the acquisition is estimated at £65.9 million (€75.1 million; $104.6 million) with the deal expected to close by the end of the year following third party approvals, HSBC said.
The price paid is in line with the valuation of similar PFI and PPP investments in the company's current portfolio and in line with current valuations in the Canadian PPP market, the company said.
The four stakes being purchased by the company include a 50 percent stake in Kent Schools PFI Project; a 41.6 percent indirect holding in the M80 motorway contract (currently under construction in Scotland) whcih can increase to 49.9 percent through the future exercise of option rights over minority interests; a 50 percent stake in a ring-road PPP being built in Alberta, Canada; and a 50 percent interest in a transit project in British Columbia, Canada.
HSBC said the acquisition will be funded from the company’s existing cash resources and debt facility.
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