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3i Infrastructure plc

3i Infrastructure plc Proposed Placing of up to 81 million of New Ordinary Shares

3i Infrastructure plc (LON: 3IN), the FTSE 250 international infrastructure investment company, has today announced a proposed placing of up to 81 million new ordinary shares in the capital of the Company by way of a bookbuild.

Highlights of the Placing

· Proposed Placing of up to 81 million Placing Shares with the Placing price to be determined via a bookbuild

· Net proceeds of the Placing will enable repayment of debt drawn on the Company’s revolving credit facility, providing flexibility to finance future acquisitions from a healthy pipeline of potential infrastructure investments in the UK and Continental Europe

· Placing Shares will qualify for the interim dividend for the first half of the year ended 31 March 2020, which is expected to be declared in November 2019

· The Placing is expected to close at 4pm on 10 October 2019

J.P. Morgan Securities plc (which conducts its UK investment banking business as J.P. Morgan Cazenove) and RBC Europe Limited (trading as RBC Capital Markets) have been appointed as joint bookrunners in respect of the Placing.

Commenting on today’s announcement, Richard Laing, Chair of 3i Infrastructure plc, said:

3i Infrastructure has a track record of delivering consistently good returns. In the 12 years since the IPO to 31 March 2019, the Company delivered a net asset value growth of 13% p.a. (including dividends), leading to a total shareholder return of more than twice that of the FTSE250. This has been achieved through strong execution by our Investment Manager against our strategic objectives, in particular selective investments into new assets, active asset management of the portfolio and well-managed realisations. Our portfolio of infrastructure assets is balanced by geography and sector and is well placed to continue to deliver our return objectives. The proceeds from the proposed Placing will repay drawings under our RCF and provide liquidity to fund our pipeline of potential investments across our target markets.

Background to and reasons for the Placing

The Company continues to be active with its infrastructure portfolio, investing a total of c.£1.6 billion in new portfolio companies since 2015 – ESVAGT, WIG, TCR, Valorem, Infinis, Attero, Tampnet, Joulz and Ionisos – while successfully managing the sale of its stakes in Eversholt, Anglian Water Group, Elenia and Cross London Trains.

On 25 September 2019, the Company invested c.€210 million to acquire c.95% of Ionisos alongside management. Ionisos is a leading owner and operator of cold sterilisation facilities servicing the medical, pharmaceutical and cosmetics industries. As a result the Company is £192 million drawn on its RCF.

The Company’s Investment Manager is originating a good flow of new investment opportunities through its platform across Europe and remains disciplined in investing selectively. The Board continues to hold the view that the Company’s RCF should not be used as long-term debt and, given the pipeline, the Directors believe it is an appropriate time to raise new equity.

The net proceeds of the Placing will principally be used to repay the Company’s RCF and provide the Company with maximum flexibility for new investment opportunities. Any remaining balance of the net proceeds will be used for general working capital purposes and/or to fund further acquisitions.

The Placing Shares will rank pari passu in all respects with the existing ordinary shares in the capital of the Company, and they will be entitled to the interim dividend expected to be declared in November alongside the announcement of the Company’s half-yearly results to 30 September 2019. The Company’s total dividend target for the year ending 31 March 2020 remains 9.20 pence per share.

The Company separately announced a performance update on 30 September in respect of the period since 1 April 2019. As stated in the announcement, performance of the portfolio continues to be in line with expectations. The NAV growth for the period is expected to be consistent with the Company’s target return.

Details of the Placing and expected timetable

Under the terms of the Placing, the Company intends to issue up to 81,000,000 Placing Shares of no-par value in the capital of the Company, under the authority granted at the AGM on 4 July 2019.

The Placing will be non-pre-emptive and launched immediately following the Company’s announcement. The price at which the Placing Shares will be issued and the number to be issued, will be determined at the close of the bookbuild for the Placing, expected to be at 4.00 p.m. (London) on Thursday, 10 October 2019 and announced shortly thereafter. The results of the Placing are expected to be announced on Friday, 11 October 2019.

The Company reserves the right, after consultation with the joint bookrunners and the Investment Manager, to scale back applications under the Placing at its absolute discretion in such amounts as it considers appropriate.

The Company will apply for admission of the Placing Shares to listing on the premium listing segment of the Official List of the Financial Conduct Authority and to trading on the main market for listed securities of the London Stock Exchange plc. It is expected that settlement of subscriptions in respect of the Placing Shares and admission will take place such that trading in the Placing Shares will commence at 8.00 a.m. (London) on 15 October 2019.