The transaction has increased the company's overall exposure to between 40% and 50% in the underlying BSF assets. INPP will invest £14.3 million (US$21.3 million) for the additional 40% interest from Babcock Project Investments Limited.
The Lewisham project comprises four BSF schools located in the South East London borough, including:
The opportunity to acquire the interest in the project has arisen through pre-emptive rights that INPP gained as part of its 100% stake in Building Schools for the Future Investment (BSFI), which it acquired from the Department of Education and Partnerships UK in August 2011.
Following the acquisition, INPP will hold a 50% interest in three of the underlying BSF assets and 40% in the fourth (as above). The Costain Pension Fund and Lewisham Borough Council will continue to hold the remaining interests in the project. The acquisition will be funded through the Company's corporate debt facility, which will be c.£41 million drawn following the investment.
The investment has been completed at a level of projected return that INPP regards as attractive and demonstrates the value of the pre-emption rights it acquired as part of the original BSFI investment.
Rupert Dorey, Chairman of International Public Partnerships, stated:
"INPP is pleased to have acquired this additional interest in the Lewisham BSF project, enhancing its overall exposure to the Lewisham schools. The transaction is further evidence of the value that the original BSFI transaction has brought to the portfolio, particularly through the pre-emptive positions that continue to be available to the Company."