BBGI Global Infrastructure Share Chat (BBGI)

When I bought these had a bit of a discussion with The Trotsky on whether it was worth it when I said

"I am looking for, my calculation is 3.22% return for hopefully 6 months giving 6.654% car or perhaps more if deal completed quicker"

In the end it was 3.34% which includes the dividend for just under 4 months so somewhere around 10.4% car (have not done exact calculations) for money that sitting in my SIPP that would be getting 2% if left in cash or around 4.3% (including dealing costs) if put into MM funds so happy with the return. Will put funds into another REIT or IT in wind down.

The proceeds are in my II account now.

It is, it's always sad when one of these stalward investment trusts sells out and shrinks the sector - fewer solid infrastructure trusts around now.

Thank you Slowly. As I said, I sold out (early April) so haven't been tracking it.

BBGI is a big loss to (mostly) British investors.

"if the deal didn't go through"

The offer was declared unconditional on 20th May. Last day of trading is 17th June.

Acceptance level was 93%, and the remaining 7% would (IMO) be smart to accept pronto, as I suspect any who don't will be left with something worth far less and that is hard to sell.

Bear, are you (or anyone else) keeping track of the acceptance level for the deal? I haven't been as I sold out. But, like you, I would dive back in if the deal didn't go through as I was a big fan of BBGI's assets and would happily hold the shares again, especially if they dropped to the pre-deal share price.

I sold all my holding in BBGI yesterday, rather cash in the hand and take a small loss than wait for Bidco to pay up.

HOWEVER I am on the side lines because if by any chance the bid fails (the acceptance level so far is very low )

then BBGI may well drop back to pre-bid levels when I will happily buy back in for my long term income folio as

I was quite taken with the asset base and income BBGI offered.

Interesting. I've never had a problem with ii but can understand iWeb's stance. Presumably, if you sell after having accepted the offer, the broker's back office would need to notify the comany that your acceptance had been rescinded; saves a bunch of time and effort for the broker if it stops you selling after you've accepted the offer (but this ought to be made clear at the outset).

"There's nothing to technically stop you accepting the offer and selling your share in the open market"

This is true as I can with my shares with II but when my partner tried to sell the ones in IWEB to buy another share found they we missing from the account and after speaking to IWEB they said it is because the offer was accepted. Tried to get this reversed but after about 30 mins on the phone with IWEB gave up as had a doctors appointment, this is not the first problem I have had with IWEB.

There's nothing to technically stop you accepting the offer and selling your share in the open market beforehand, bizarre as that may seem. I've done it before now.

They will need over 90% acceptance for the offer to go unconditional. The market tends to always assume that the offer will proceed until it doesn't. The price does seem to have edged up slightly this morning which might seem to suggest that the market thinks that an increased offer might be in the offing but I'd be surprised. Unlike some offers that have been made for other REITs recently (CARE and HEIT), BidCo has already pitched its offer at above the most recent NAV and I doubt there's much scope, if any, to increase the offer further but we can wait and see.

Yes, it does seem strange that the acceptance level is so low. Speaking for myself, I haven't accepted the offer yet because I'm unclear as to whether I would still be able to sell my shares on the open market after accepting the offer, so I'm keeping my options open. There's still over a month left to accept the offer, and there doesn't seem to be any benefit in accepting early. Perhaps other shareholders are thinking the same.

If I remember correctly, the offer will only go ahead if there's 90% acceptance. Should we be concerned that this will not be achieved? I don't know. The market doesn't seem very concerned, given that that the share price is only about 2% below the offer price.

I was rather surprised by the low level of acceptances to date given that BidCo is offering to buy the shares at a premium to the estimated NAV at 31 December 2024.

I asked T212 about accepting the offer, and got this reply: "As your shares are held in a pooled nominee structure and not directly in CREST under your name, Trading 212 is unable to facilitate individual TTE (Transfer to Escrow) instructions. We rely on our custody partners to process corporate actions, and we will notify you via the platform if your participation becomes possible."

I think that's all fairly standard.

The bid can't proceed until the offer goes unconditional (the bidder has acceptances for >90% of the issued share capital) and, as such, that date is currently unknown for certain but is expected to occur on, or before, the Unconditional Date (the 60th day following the publication of the offer document i.e. 6th May, given that 5th May is a Bank Holiday). Payment for the shares is then expected to occur no later than 14 days after the Unconditional Date.

It's normal takeover practise to allow the bidder to extend the offer period in the event that they haven't quite reached the 90% requirement by the Unconditional Date (up to the Long Stop Date, 6th September, if required).

In the event that the offer goes unconditional, then those shareholders who hadn't accepted the offer previously are then encouraged to do so at their earliest opportunity and they are usually paid out no later than 14 days after they accept the offer. Once the offer goes unconditional, BidCo can then proceed to have the shares in BBGI de-listed but they can't force the remaining minority shareholders to sell. So, as such, the ball is entirely in the court of these shareholders to determine when and if they get paid for their shares (if they don't accept the offer, they don't get paid).

Whe

I really do not understand the Corporate action in as much as it says, if you opt to sell your shares to Boswell at 1.433 it may take some time to get the cash ....... and Boswell may extend the offer period and again which would cause a delay to the payout

and

if you don't agree to sell your shares and the takeover happens, if and when the assets are sold the cash distribution may be whatever Boswell deems it to be

Maybe the only sure way is to sell your shares in the open market, at least then it's cash now albeit at 1.4 or below

What do you think?

Any idea when we would receive the payment for the shares. Is it likely to be as late as October? If looked through the documents but cant see any suggestions as to when its likely to be completed except 3rd quarter.

Received this Corporate Action on my account

"Further to our previous communication, BBGI Global Infrastructure S.A has announced that it has now received a takeover offer from Boswell Holdings 3 S.C.Sp. You now have the choice to sell your shares to the new company with no dealing charges.

Under the terms of the offer, you have the option to tender your shares to Boswell Holdings 3 S.C.Sp. at a price of GBP1.433 in exchange for each share held.

The company has also announced an interim dividend of GBP0.042 for each BBGI Global Infrastructure S.A. share held as of the record date, 7 March 2025.

To view the offer document, please copy and paste the link below into your web browser:

https://www.bb-gi.com/media/2446/offer-document-final-version.pdf

If acceptance levels for Boswell Holdings 3 S.C.Sp’s offer reach 90%, it intends to delist BBGI Global Infrastructure S.A. and/or may proceed with an Asset Sale. However, the proceeds of the Asset Sale are not guaranteed to be distributed to remaining shareholders. In the event of a return, any proceeds may not match the value offered in the takeover.

If you would like to accept the offer, please input your election by specifying how many shares you would like to accept the offer for. If you do not wish to accept the offer for all of your shares, please enter the number of shares you wish to keep into the default option, 'Take no action'.

If you choose to accept the offer, you are confirming that you have read the official document, including details of any restrictions, and that you are eligible to participate.

Takeovers can, on occasion, take a long time before they start to pay out to customers who choose to accept the offer, and are often extended multiple times. If you choose to accept the offer, you will not receive details of any extensions and you will not be able to sell your shares. Once Boswell Holdings 3 S.C.Sp. commences payments, your account will be credited with the proceeds upon receipt.

We will elect to accept the offer on your behalf in the event that it becomes compulsory.

AJ Bell is unable to provide advice and this notification does not constitute investment or tax advice. If you are in any doubt as to which action to take, please contact your financial advisor.

Please copy and paste the below FAQ link into your web browser for more information on corporate actions:

https://www.ajbell.co.uk/sites/ajbell.co.uk/files/AJB_Corporate_action_FAQs.pdf

IMPORTANT NOTE – If you have any questions or queries regarding this event, please send us a secure message and ensure you quote the following in the ‘Subject’ field: CORPORATE ACTION – BBGI Global Infrastructure S.A – 9892977

Updated: 14/03/25"

I was wondering why the share price went down yesterday. I hadn't noticed that it went exdiv. That would explain it. Everything still on track then. 😀

4.2p dividend declared yesterday.

"As a result of the dividend declaration, the offer price for BBGI's recommended takeover by Boswell Holdings 3 was adjusted.

The original offer of 147.5p per share, announced on 6 February, had been reduced to 143.3p per share to reflect the value of the dividend."

The problem with holding is that there is now a ceiling for the SP of 145-146p. So if other infra etc. goes up by 5%, 20% or whatever, then you are missing out. Not a recommendation but I sold @145p in the initial euphoria as there simply wasn’t much financial point hanging on.

Tich, If the sale isn't wrapped up before October, I don't see any reason for BBGI not to pay a dividend and I'm not entirely certain that the purchaser would reduce the purchase price further (as I said, I think a lot will depend on NAV performance between now and then). If there was absolutely no possibility I don't think the purchaser would "reserve the right"; they'd rule it out completely from the outset. That's my take.

From the RNS:

"If any dividend or other distribution is declared, made, or paid in respect of any BBGI Shares on or after the date of this Announcement, Bidco reserves the right to reduce the Offer Price by the amount of such dividend or distribution. In such circumstances, BBGI Shareholders would be entitled to retain any such dividend or distribution."

So, even if there is a dividend in October (which seems unlikely to me), the amount will probably be deducted from the purchase price. In other words, 147.5p is all we will receive in total.

So I agree, it's a choice between selling now or holding on for about a 3% gain over about 6 months. I suppose that's better than you can earn on cash. So I'll hold unless I spot something else I really want to buy with the money.

Having only come on board a couple of months ago I should be happy at a quick return around 15% but I don't. The deal is not that great NAV would have eventually risen back up and if bond rates continues to fall then gone to a premium.

Like others here I liked this for a LT hold in my pension income pot, now I have to look elsewhere but it will not be easy to match the profile of BBGI. Secure income mostly inflations linked and diversification beginning from fixed term deals to long term was good. Like others I question holding but will do unless I see something better. All the best

Agreed the yield is good for a low risk inflation linked investment, but we do need to see new investments being made when available or long term (beyond 12 - 15 years ) returns will diminish as assets reach handback. But every confidence management have that in view.

So yesterday this became a new addition to our income portfolio providing for our retirement income.

I have rated it a Buy as I have bought but DYOR, hopefully in the New Year if interest rates fall? we will see a rise in the share price and a narrowing of the discount .

I am slightly surprised to see the share price languish where it is, but equally quite grateful as it has come at a time of making some largish investments and I've been able to take advantage with multiple purchases between 124-127p. BBGI is a cornerstone investment for me to help cover family retirement costs because, in my view, it acts like a mini-pension fund. A 6.72% yield (8.4/125p) is substantial considering it is (a) largely covered by government/ local authority contracts, and (b) is mostly inflation linked.

News this week as well of BBGI's repositioning of its finances and fee structure, which looks to me like they are gearing up to be able to add assets when the right opportunity presents itself.

Thankyou Guitarsolo

Good evening Kentio,

I can confirm that I received the last two dividends (3.965p and 4.2p) in full, inside an ISA, with no withholding tax deducted.

Guitarsolo

Perhaps an erxisiting investor (shareholder) can confirm they have received BBGI dividends in full without a withholding tax. deduction

There appears to be a WHT exemption for dividend distributions made by Luxembourg funds to their investors according to this website: https://cms.law/en/int/expert-guides/country-tax-guide/luxembourg

BBGI is a Luxembourg company so is there a 15% Withholding Tax on all dividends ?

How are you determining its inflation linkage?

Watching this one but sector uncertainty (over done to my mind) means I’ll wait for some stability - maybe results will provide that in the individual case here?

I'm tempted by BBGI, as I really like the visibility of its cash flows. But I have difficulty getting past the fact that its inflation linkage is only 0.5. As a recent retiree, I fear inflation!

By the way, don't overlook the disclaimer at the top of the Kepler article: "This is a non-independent marketing communication commissioned by BBGI Global Infrastructure."

Doh. Here’s the rest!

What is particularly significant here is that 55 of the trust’s 56 holdings have fully amortizing fixed rate borrowing costs, with no refinancing obligation. This means that higher rates have had no impact on the borrowing costs for these investments.

The one remaining portfolio company does face a refinancing obligation for a tranche of debt in Q3 of next year. However, the managers have hedged out the risk of a change in base rates for this amount, meaning the risk only pertains to the lender’s margin in excess of the base rate.

BBGI did use its revolving credit facility (RCF) to make two investments in 2022. However, this was expected to have been fully repaid by the close of last year from excess cash BBGI has generated from its portfolio. Assuming that was the case – BBGI’s results are out later this month – it illustrates the trust’s ability to grow organically and the fact it does not need to go and raise funds from the market.

Another key and related point is the fact that the trust does not have any obligations to invest, meaning it is not in a position where it will become a forced seller to meet such obligations. In fact, the trust is in a position whereby it could make no more investments and still pay a rising dividend for the next 15 years.

This is a reflection of the fact that BBGI pursues disciplined growth that builds shareholder value first, encouraged by an internal management structure, and not growth in assets under management for its own sake.

Taken as a whole, we think this means BBGI offers attractive defensive features, which mean the trust can continue to pay a sustainable, rising dividend over the long-term, that is heavily protected from the risks of an economic downturn or higher refinancing costs.

The trust is also shielded from inflation due to the inflation-linkage in its contracts. Indeed, if inflation does continue to run higher then BBGI can actually benefit from an increase in its underlying revenues.

At the same time, the trust enjoys potential upside from lower inflation and potential rate cuts. If we do see these later this year, it’s plausible the trust would see a tightening of its discount – currently at 13.3% - as investors start to find the nearly 7% forward yield more attractive than it already is.

A widening of discounts across the infrastructure sector over the past two years can leave you with the impression that rate hikes have impacted – or are likely to impact – all trusts equally. The reality is that some are much less susceptible to the risks higher rates create than others.

BBGI Global Infrastructure (BBGI) is a prime example of this. The trust has a globally diversified portfolio of availability-style assets, with government or government-backed counterparties and inflation-linked contracts. All of the trust’s holdings are in AA/AAA-rated investment grade economies.

The result of this set up is that BBGI’s investments produce highly predictable cash flows from reliable public sector counterparties, regardless of economic cycles or market volatility. The pandemic provided a great example of the strength of this model as the trust continued to generate its usual cash flows, despite the global economy grinding to a halt.

From these secure, predictable cash flows, BBGI has been able to deliver annual increases to dividend payouts, and BBGI has met or exceeded all its dividend targets since its IPO in 2011. Indeed, the trust is targeting an annualised increase to dividends of 6% for 2024, following a 6% dividend increase for 2023, these are sector leading dividend increases. These are likely to be fully covered as BBGI aims to have dividend coverage of 1.3x over the long-term.

The inflation-linkage in the trust’s contracts also means that it has been more immune from the impact that rising prices have had elsewhere over the last two years. The inflation-linkage in BBGI’s contracts is index-linked and works in a mechanical way, with mark ups to contracts made and passed directly on to clients, in some instances on a monthly basis.

BBGI also mirrors these contracts with the management companies it pays to ensure the trust’s holdings remain fit for use. This limits the degree to which there can end up being a mismatch between revenue the portfolio generates and the amount that must be paid to these contractors.

What this has meant in practice over the past two years is that BBGI has seen an increase in revenues, as it has been able to mark up contracts with its counterparties to reflect higher rates of inflation. At the same time, equivalent agreements with the trust’s contractors mean that costs have been kept under control and not increased to the detriment of the trust’s earnings.

Secure, increasing revenue is important but it has arguably been fears around debt that have prompted reratings in the broader investment companies market. However, here too BBGI’s managers have structured the trust to shield it from the impact that higher rates could have.

The majority of BBGI’s debt is on the portfolio level, with no structural gearing at the trust level. What is particularly significant here is that 55 of the trust’s 56 holdings have fully amortizing fixed rate borrowing costs, with no refina

This is going ex-divi next Thursday 23rd February. That may provide the ideal buy-in price of close to 140p. We shall see……….

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Let’s make that today , forgot about b/holiday.

Due to the future inflationary pressures starting to mount up I am adjusting my funds and shares a bit and having seen this company mentioned in the FT I am going to buy on Monday with a bit of profit from a few of my funds that aren’t inflation linked. Also adding to Unilever which is inflation bomb proof. :-).

Why I am invested in BBGI Global Infrastructure.

I monitor many top 350 shares and I had BBGI on my watch list for over two years and began buying in February 2021.

I am transitioning from AIM to top 350 companies with a goal of obtaining dividends of £40,000 a year from my SIPP.

I currently have seven shares that are paying me almost £3,000 over April & May and I have a goal of a minimum dividend yield of 4%.

BBGI are paying their dividend today and they did offer me a script alternative but, on this occasion, I decided to accept the cash dividend.

Currently they yield about 4.18% and in 2021 they have a goal of paying 7.33p which at the current price of £1.724 is a yield of 4.25%.

What BBGI do is in the name “Global Infrastructure” Where they invest in reliable and dependable infrastructure projects with a guaranteed income.

RKB

Recommended share tips today!

going to catch fire this one, which, given the current volatility, is something for which i'm grateful. Decent dividend from this niche infrastructure business should allow for a decent night's sleep. Almost nodding off typing. All imho, dyor. GL out there.

was pretty big?

Bilfinger Berger Global Infrastructure has completed the acquisition of interests in three projects from Assura Group for 9m pounds. The company is buying the equity and subordinated debt interests in Liverpool & Sefton Clinics, North London Estates Partnerships and Mersey Care Mental Health Hospital. The Liverpool & Sefton Clinic project is a UK concession to develop, fund, build, operate and manage primary healthcare facilities in Liverpool and Sefton. The North London Estates Partnership project is a UK concession to develop, fund, build, operate and manage primary healthcare facilities around Barnet, Enfield and Haringey. The Mersey Care Mental Health project involves transforming the former Walton Hospital site in Liverpool into a new, 85 bed, mental health in-patient facility. "The acquisitions are accretive and allow us to increase our stakes in these high quality PPP projects at attractive pricing levels," said Co-Chief Executive Frank Schramm.

These are as steady as a rock....buying patterns all look very uniform....is this pension funds buying .....looked at the prospective, what is a seed portfolio????