HICL Infrastructure Regulatory News (HICL)

14 July 2017

HICL Infrastructure Company Limited

Acquisition of a new investment

HICL Infrastructure Company Limited ("HICL" or the "Company"), the listed infrastructure investment company advised by InfraRed Capital Partners Limited ("InfraRed"), is pleased to announce that it has signed an agreement to acquire a 35 per cent equity interest in the entities that comprise the High Speed 1 Project ("HS1").

HICL is a member of a consortium, alongside funds managed by Equitix Investment Management Limited and third party funds managed by InfraRed, which has agreed to acquire 100 per cent of HS1 from Borealis Infrastructure (on behalf of OMERS Administration Corporation) and Ontario Teachers' Pension Plan Board. The members of the consortium will acquire interests in HS1 pro rata by reference to their respective shareholdings, with HICL and the Equitix funds each acquiring 35 per cent, and the third party InfraRed funds acquiring the balance of 30 per cent.

HS1 is a strategic asset in the UK and operates the country's only high-speed rail link, including four stations and associated infrastructure. The rail link runs for approximately 109km between London St Pancras International station and the Channel Tunnel. In 2016, it carried over 20 million passengers, providing critical transport infrastructure for commuters in South East England and connecting London to several major European cities. HS1's revenues are generated from domestic and international train journeys; unregulated activities, principally comprising retail leases at St Pancras International; and regulated activities such as maintenance and operations. The acquisition is consistent with HICL's strategy of investing in assets that are positioned at the lower end of the risk spectrum.

HICL's share of the consideration amounts to up to £320 million. Completion will occur following satisfaction of provisions in the HS1 concession agreement relating to a change of control of HS1. Following completion, HICL intends to bring in minority co-investors managed by InfraRed representing up to £120 million of its commitment, subject to the terms of the concession agreement. This is consistent with its strategy of partnering with aligned co-investors on larger transactions.

The investment will be funded using HICL's existing cash resources and drawings from its revolving credit facility. Following completion of the acquisition, and on the basis that HICL has brought in co-investment of up to £120 million of its equity interest, HICL will have a net funding requirement of approximately £140m.

Harry Seekings, Director (Infrastructure) at InfraRed Capital Partners Limited, said:

"HS1 is a strategically important, core UK infrastructure asset and InfraRed is delighted to have secured this opportunity for HICL. The investment is in line with HICL's stated acquisition strategy and is expected to be accretive to the existing portfolio, in particular with regard to yield and inflation correlation.

"Following the completion and finalisation of co-investment, approximately 16 per cent of the HICL portfolio will be invested in demand-based assets with returns that are correlated to wider economic activity. This remains within the Company's 20 per cent limit for investments of this nature.

"HS1 has a strong track record, which is underpinned by operational excellence, and we look forward to working with the management team to support the continued delivery of a high-quality service for HS1's customers."

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR").

-ends-

Enquiries

InfraRed Capital Partners Limited +44 (0) 20 7484 1800

Harry Seekings

Keith PickardTony Roper

Tulchan Communications +44 (0) 20 7353 4200

David AllchurchLatika Shah

Canaccord Genuity Limited +44 (0) 20 7523 8000

David Yovichic

HICL Infrastructure Company Limited

HICL Infrastructure Company Limited ("HICL" or the "Company", and together with its subsidiaries the "HICL Group") is a long term investor in infrastructure assets which are predominantly operational and yielding steady returns. It was the first infrastructure investment company to be listed on the London Stock Exchange. With a current portfolio of 116 infrastructure investments, HICL is seeking further suitable opportunities, which are positioned at the lower end of the risk spectrum, in three target markets segments: PPPs; regulated assets; and demand-based assets.

Further details can be found on the HICL website, www.hicl.com.

Investment Adviser (InfraRed Capital Partners)

The Investment Adviser to HICL is InfraRed Capital Partners Limited ("InfraRed") which has successfully invested in over 200 infrastructure projects since 1997. InfraRed is a leading international investment manager focused on infrastructure and real estate. It operates worldwide from offices in London, Hong Kong, New York, Seoul and Sydney. With over 120 professionals it manages in excess of US$9bn of equity capital in multiple private and listed funds, primarily for institutional investors across the globe. InfraRed is authorised and regulated by the Financial Conduct Authority.

The infrastructure investment team at InfraRed consists of 60 investment professionals, all with an infrastructure investment background and a broad range of relevant skills, including private equity, structured finance, construction, renewable energy and facilities management.

InfraRed implements best-in-class practices to underpin asset management and investment decisions, promotes ethical behaviour and has established community engagement initiatives to support good causes in the wider community. InfraRed is a signatory of the Principles of Responsible Investment.

Further details can be found on InfraRed's website, www.ircp.com.

Equitix

Equitix is a leading developer, investor and long-term fund manager of core infrastructure assets, predominately in the UK. It has over £2billion of equity under management and invests for the long-term in investments with stable, predictable yields.

High Speed 1

HS1 is a modern high-speed rail line allowing speeds of up to 300 kph and 230 kph for international services and domestic services, respectively. HS1 connects at several points to the classic rail network and provides passenger connectivity with other public transport options.

Domestic passenger services are operated by London and South Eastern Railway Limited, which currently holds the South Eastern franchise. LSER has delivered >10% passenger growth since the start of high speed domestic operations in December 2009. International passenger services have been operated by Eurostar International Limited for over 20 years with 10 million passengers p.a. on its two core routes to and from Paris and Brussels, which account for 97% of passenger demand. Newer routes include Marseilles (launched May 2015) and Amsterdam (launching December 2017).

HS1's four rail stations generate income through the provision of unregulated activities, comprising retail leases and car parking facilities. St Pancras, located in Central London, is the flagship station generating 98% of the Company's total retail income. St Pancras has 108,100 sq. ft. of prime retail space and attracts c.50million visitors a year.