HICL Infrastructure PLC on Wednesday said it has sold its stake in a toll-road project, in order to help finance a £50 million share buyback.
Shares in the London-based closed-ended investment company were up 3.8% to 126.19 pence each in London on Wednesday morning.
It said it has entered an agreement to sell its entire stake in the US Northwest Parkway toll-road project to Vinci Highways SAS for about $232 million. The proceeds represent a 30% premium to the company’s valuation at the end of September.
‘The company believes the strong valuation reflects both this dynamic and the asset’s strong inflation correlation, particularly over the past two years,’ it said.
Completion is expected in the second quarter of 2024.
HICL said that up to £50 million of the sale proceeds will be used to fund a share buyback programme, with the remainder allocated to the drawn balance on its £650 million revolving credit facility. The RCF is expected to be about £135 million drawn at March 31.
HICL Chair Mike Bane said: ‘HICL’s latest disposal yet again demonstrates the extent to which HICL’s high quality portfolio continues to be undervalued by public markets. At a significant discount to NAV, HICL’s shares represent a particularly attractive investment and a highly accretive allocation of disposal proceeds.’
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