18th Aug 2025 09:27
(Alliance News) - HICL Infrastructure PLC on Monday said it will consider acquisitions and a further share buyback after announcing an asset sale amid solid trading.
The London-based closed-ended infrastructure investment company said it will sell seven public private partnership assets for GBP225 million to Dutch pension services provider, APG.
The portfolio comprises 50% of HICL's investments in Southmead Hospital and Pinderfields and Pontefract Hospitals and the entire equity interest in four UK NHS Local Improvement Finance Trust projects and Edinburgh Schools.
The price includes cash distributions received by HICL since April 1, and is in line with the company's last audited valuation of the assets as at March 31.
The majority of the consideration will be received on completion, with a small non-contingent deferred element of GBP14 million due by June 30, 2026, although this may be brought forward.
HICL said the sale is accretive to several "key" portfolio metrics. Following completion, HICL's exposure to healthcare assets will reduce to 16% from 22% of gross portfolio value, it said.
Completion of the sale is expected by the end of the year. Proceeds will be used to fund the share buyback programme, fully repay the revolving credit facility, and meet existing investment commitments of around GBP110 million.
As part of this deal, HICL has agreed a partnership framework with APG which provides the opportunity to pursue further transactions over time.
The agreement takes asset sales over the last 24 months to GBP725 million, HICL said, "comfortably" ahead of the previously stated target of at least GBP200 million of disposal by March 31, 2026.
As a result, HICL said it will consider the "deployment of excess proceeds in line with its disciplined capital allocation framework."
This will include consideration of selective acquisition activity alongside further share buybacks, it said
In March, HICL announced a GBP100 million share buy back after completing a previous GBP50 million programme.
"Looking forward, the company's solid balance sheet and liquidity position will allow it to respond nimbly to attractive investment opportunities that are consistent with the company's strategy," HICL added.
Shares in HICL rose 0.8% to 120.00 pence each in London on Monday morning.
In addition, HICL updated on trading from April 1 to August 15.
The firm reported a solid operational performance across the portfolio, with yield investments continuing to underpin cash generation, in line with expectations.
Growth assets progressed capital expenditure in accordance with business plans, supporting both earnings and longer-term cashflows, HICL said.
As a result, HICL said it remains on track to deliver its covered target dividend of 8.35 pence per share for the financial year to March 31 2026 and the board reiterated its dividend target of 8.50p for the year ending March 31 2027.
By Jeremy Cutler, Alliance News reporter
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