International PPL makes further investment in Gold Coast Light Rail
Listed infrastructure investment company International Public Partnerships announced on Wednesday that it has acquired a further 3.33% interest in the Gold Coast Light Rail Project from Aveng Group.
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The FTSE 250 firm said the follow-on investment in the project has arisen from shareholder rights to acquire proportionate shares from fellow consortium members who choose to dispose their interests.
International PPL's total investment will increase to 30%, from from 26.67%, and under the terms of the acquisition it will make immediate and future committed investments totalling approximately AUD 3.5m.
“The company has been a long-standing shareholder in the project through the GoldLinQ Consortium alongside Plenary Group, Marubeni Group, Palisade and Keolis,” its board said in a statement.
“Stage 1 of the project delivered by the Queensland Government and GoldLinQ saw the development of a AUD 1.29 billion, 13 km light rail system between Gold Coast University Hospital and Broadbeach, [which] has been operational since July 2014.
“Stage 2 comprises a 7.3km extension from the Gold Coast University Hospital north to Helensvale which will link the light rail system to the State's heavy rail line and incorporate three additional stations.”
International PPL said construction completion of Stage 2 is scheduled at the end of the 2017.
Key features include a 13 year concession term ending in 2029, to coincide with the original project term, revenues linked to the availability of the asset and partially linked to Australian CPI, and construction and operations risk fully passed down to McConnell Dowell for Stage 1 and CPB Contractors for Stage 2 as design and build contractors, and Keolis Downer EDI - currently the incumbent operations and maintenance contractors.
Revenues were contracted with the Queensland State Government, there was no refinancing risk, and a “robust” financial structure was in place with conservative gearing and senior debt provided for the term of the concession by BBVA, Intesa, KfW, EDC, BTMU and Mizuho, International PPL said.
“Future investments under the terms of the acquisition will be made during the second half of 2017 and are secured by a letter of credit.
“The return profile of the investment pursuant to the acquisition is expected to be consistent with the returns being generated by the company on its existing investment in the project.”