10th Feb 2014 12:24
LONDON (Alliance News) - John Laing Environmental Assets Group Ltd Monday said it intends to launch a placing and initial public offering with the aim of raising a minimum of GBP160 million to enable it buy a number of assets from John Laing PLC.
In a statement, John Laing Environmental Assets Group said it will list on the main market of the London Stock Exchange and will be made up of a diversified group of renewable energy and waste and waste water PFI assets in the UK. The fundraising could be increased to GBP174 million, depending on investor appetite, the group said.
In a move that harks back to the company's 2010 spin-off of the John Laing Infrastructure Fund Ltd, John Laing PLC said it intends to sell seven operational and yielding environmental infrastructure assets to the newly launched fund, upon completion of the IPO.
The assets will be purchased, on or around the date of admission of its shares to trading, from John Laing and a fund managed by Henderson Equity Partners Limited.
John Laing Capital Management Ltd, owned by the John Laing Group, will be the fund's investment adviser, while John Laing Investments Ltd, a subsidiary of John Laing PLC, will take on a 24.9% stake in the fund.
In a telephone interview David Hardy and Chris Tanner, who will lead the investment adviser's team, told Alliance News that further acquisitions are expected but said there's no fixed timeline for when they might occur.
They said the fund has the option of acquiring further assets from John Laing PLC but can also look externally.
Hardy and Tanner said the expectation is that future acquisitions will be funded by further issue of equity, depending on investor demand, but said the fund will also run a "small" debt facility.
The expectation is that the fund will IPO with a net asset value of 98 pence a share, according to Hardy and Tanner, while targeting a dividend payout of 6 pence per share a year, to rise in line with inflation.
"An increasing focus on sustainability and making use of natural and waste resources, coupled with strong legislative support to encourage private investments in environmental infrastructure projects, form a favourable backdrop to the launch of this diversified and well-balanced fund," Tanner said.
John Laing Investments Ltd is able to increase its stake to up to 29.9% of the share to be be issued, while it is can scale back its investment to a 10% minimum stake if the issue is oversubscribed.
By Samuel Agini; [email protected]; @samuelagini
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