Cash offer for John Laing Infrastructure – The board of John Laing Infrastructure and a consortium which comprises Dalmore Capital Limited and Equitix Investment Management Limited confirm they are engaged in discussions regarding a possible cash offer for John Laing Infrastructure, to be made by a new company to be jointly owned by funds managed or advised by Dalmore and Equitix. The possible offer is at a price of 142.5 pence per share in cash and there would also be the payment of a dividend of up to 3.57 pence per share to JLIF shareholders prior to closing of the transaction.
The total consideration (cash offer plus dividend) represents an approximately 23.6 per cent. premium to JLIF’s closing share price as at 13 July 2018 and an approximately 19.8 per cent. premium to JLIF’s latest published NAV per share as at 31 March 2018.
Following a period of negotiation with the consortium, the board of JLIF has indicated that it is minded to recommend a firm intention to make an offer for JLIF if on the terms set out in this announcement.
The announcement of any offer is conditional on, amongst other things, completion of a customary due diligence exercise to the satisfaction of the consortium. The terms and conditions of any offer, if made, will be set out in a further announcement.
The consortium reserves the right to make an offer at any time on less favorable terms in certain scenarios including somebody else making a lower offer or he board issuing more shares or declaring a larger dividend.
There can be no certainty that any offer will be made.
[QD comment: valuing infrastructure funds, and similar funds with long-tern predictable cash flows such as renewable infrastructure funds, is largely a matter of the discount rate that you choose to work out what those cash flows are worth to you today. That varies according to how risky you think the cash flows are. These managers can pay a high premium to JLIF’s NAV if their assessment is that risks are lower than JLIF’s board have assumed. The news has pushed up the prices of all the infrastructure funds. For instance, HICL Infrastructure’s shares are up 5.5% this morning.]
Dalmore Capital Limited
Dalmore Capital Limited is an independent fund management company that provides institutional investors with access to lower volatility infrastructure assets, particularly in the UK.
Equitix
Equitix is a market leading investor and fund manager of core infrastructure assets, specialising in long-term partnerships.
JLIF : Cash offer for John Laing Infrastructure