Michelle McGagh, Citywire Investment Trust Insider, 6 Feb 2025:
BBGI Global Infrastructure (BBGI) shares have soared nearly 20% after receiving a more than £1bn takeover bid from British Columbia Investment Management (BCI).
The £871m infrastructure fund – whose assets include toll bridges, roads and facilities at schools, hospitals and prisons in G7 countries – saw its shares jump 18% to 144p on Thursday morning. That is just shy of the 147.5p per share BCI has offered, valuing the portfolio at £1.062m.
The 147.5p all-cash offer represents a 21.1% premium to the closing price of 121.8p on Tuesday and a 20.1% premium to the three-month average of 122.9p. Importantly, the price is also pitched at a 3.4% premium to the fund’s net asset value (NAV).
The bid is being unanimously recommended by the trust’s board, which said it provides shareholders ‘with the opportunity to realise in cash the value of their holdings, at an attractive value that is in excess of the reasonable medium-term prospects for BBGI on a standalone basis’.
Shareholders will be asked to vote on the deal at a general meeting, with the board confirming its members will vote the 0.4% of shares they own in favour of the offer.
The 7%-yielding fund has grown to become one of the largest listed infrastructure funds since its launch in 2011, boasting a portfolio of 56 core infrastructure assets offering long-term, index-linked cashflows. Since listing, it has delivered a NAV total return of 176.3%..
Analysts suggested the bid could prove a turning point, if it provides confidence in asset valuations more generally.
James Carthew, head of investment company research at QuotedData, said: ‘I have been warning for ages that if investors didn’t recognise the value in the infrastructure and renewables sectors, then a corporate investor or a big institutional investor would. BBGI is perceived to be the quality name in the sector because it is designed to be low risk.
‘Nevertheless, there is a read-across to peers. These NAVs are real and if you don’t take advantage of the discounts and high yields on offer, someone else will.’
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