International Public Partnerships Regulatory News (INPP)

7 Dec 2006 07:03

Babcock&Brown Public Ptnrships Ltd07 December 2006 Babcock & Brown Public Partnerships Limited Acquisition of an interest in Reliance Rail Babcock & Brown Public Partnerships Limited (LSE: BBPP) (BBPP or the Company),the global public infrastructure fund, today announced the acquisition of a12.75% equity interest in Reliance Rail. The project is valued at approximatelyA$3.6 billion, including a 30 year maintenance component and is the largest everPublic Private Partnership (PPP) project in Australia and one of the world'slargest this year. Reliance Rail is a PPP project between a consortium of investors, includingBBPP, and RailCorp, a state owned corporation of the State Government of NewSouth Wales. The partnership is contracted to finance, design, construct, ownand maintain rolling stock to be operated by RailCorp. The consortium consistsof Downer EDI, BBPP, ABN AMRO Australia and AMP Capital Investors. The trains will be manufactured by a joint venture comprising EDI Rail andHitachi. Hitachi is the manufacturer of Japan's famous "bullet train" and hasrecently been contracted to provide rolling stock for the Channel Tunnel RailLink. BBPP will be investing A$17.43 million (£6.98 million) for its 12.75% interestin the Reliance Rail Consortium. Giles Frost, Director of BBPP, said, "This investment is consistent with ourstated intention of pursuing public infrastructure opportunities that offerstable long-term cashflows and attractive returns relative to the risk profile.We will continue to capitalise on the rapid growth of PFI and PPP projectsaround the world and this is a strong first step in that process." "This investment demonstrates the ability of the Company to add value forshareholders through the deployment of capital internationally to create aglobal portfolio of PPP contracts across a diverse range of sectors." "The opportunity for BBPP to invest at par in an international greenfield PPPproject illustrates the value of the Company's relationship with its investmentadviser, Babcock & Brown Investment Management Limited, which provides access toa worldwide network of offices staffed by dedicated infrastructure specialists." For further information, please contact: Babcock & Brown Anthony Kennaway +44 (0)20 7203 7300 Notes to Editors About Babcock & Brown Public Partnerships Limited: Babcock & Brown Public Partnerships Limited (LSE: BBPP) is a newly established,limited liability, Guernsey incorporated, closed-ended investment company. TheCompany offers shareholders an exposure to investment in infrastructure assets,particularly those with a public or social character such as those developedunder public bodies under private finance initiative or public privatepartnership procurements. The Company floated on the main market of the London Stock Exchange on 9thNovember 2006 and as at 9 November 2006 had a market capitalisation of £300million. The initial portfolio of the Company consists of twenty twoinfrastructure investments the majority of which are developed under the PFIprogramme of the UK Government and the UK NHS Local Improvement Finance Trust(LIFT) initiative. Babcock & Brown has been responsible for the development andmanagement of the majority of these assets and through Babcock & BrownInvestment Management Limited (BBIML) will continue to manage them for thebenefit of BBPP. In the future BBPP intends to capitalise on the development andinternationalisation of private finance initiative (PFI) and public privatepartnerships (PPP) procurement models for public infrastructure in otherdeveloped countries, which it is anticipated will provide numerous investmentopportunities for BBPP. About Reliance Rail Reliance Rail is the successful proponent for the finance, design, constructionand maintenance of 78 eight-car double deck sets and two spare carriages for theNSW Government's Rolling Stock Public Private Partnership (PPP). The new cars will replace 498 non air-conditioned carriages and provide extrarolling stock capacity for the CityRail travelling public by 2013. The firstsets are expected to reach use in 2010. Reliance Rail is a team of Australia's leading infrastructure developers,engineers and rail services companies with proven international capacity andcapability. Reliance Rail will be an operating business with the following shareholding: •Downer EDI - 49% •AMP Capital Investors - 25.5% •Babcock & Brown Public Partnerships Limited and ABN AMRO -12.75% each Reliance Rail will be supported by the following core contractors for thedelivery of the PPP contract: •The EDI Rail - Hitachi Joint Venture - responsible for the design, manufacture and commissioning of the rolling stock and train simulators. EDI Rail is Australia's leading provider of rolling stock and maintenance services. Hitachi is a world-leading provider of reliable and safe commuter and high-speed trains and train componentry. •EDI Rail - responsible for the design and construction of the maintenance facility at Auburn. This project will be sub-contracted to the John Holland Group. •EDI Rail will create a special purpose vehicle company which will be responsible for the maintenance of the rolling stock (30-year contract), maintenance facility and train simulators. This information is provided by RNS The company news service from the London Stock Exchange