Further to the announcement on 20 January 2020, Sequoia Economic Infrastructure Income (SEQI), the specialist investor in economic infrastructure debt, has announced a proposed share issuance that seeks to raise £250m of gross proceeds.
The company intends to use the proceeds raised from the issue to repay the drawn commitments under its £280m revolving credit facility (RCF). As at 31 December 2019, the Group had outstanding drawings on its RCF of £224m and cash of £56.8m, resulting in net leverage of £167.2m. In addition, the company had undrawn commitments on existing investments collectively valued at £92.7 million. SEQI says that net proceeds in excess of the amount drawn or committed under its RCF are expected to be deployed into its near term pipeline of in excess of £380m of investment opportunities.
SEQI’s pipeline
SEQI says its manager has identified potential near-term investments available for purchase, with a total value in excess of £380m. In addition, it expects to see a steady stream of further investment opportunities in the near term. Of the Investment Adviser’s total pipeline of opportunities totaling in excess of £1.0bn, approximately 43 per cent. of the opportunities are senior secured debt instruments and 78 per cent. are floating rate debt instruments. Approximately 41 per cent. of the pipeline consists of opportunities in the US and 20 per cent. of the opportunities are in the UK.
Finally, the company says that if the net issue proceeds are less than the current amount drawn under the RCF, or following deployment of all the proceeds, it expects to re-draw funds under the RCF to invest in these pipeline opportunities or new opportunities that become available.
SEQI: Sequoia Economic Infrastructure Income targets £250m equity raise