Brookfield Infrastructure Partners L.P. (“BIP”) (NYSE: BIP; TSX: BIP.UN) signed an agreement to sell its remaining 25% interest in its U.S. gas pipeline to one of the business’s existing owners. This sale represents a complete and successful exit of the business, generating total proceeds of over $1.7 billion, crystalizing an attractive 18% IRR and a 3x multiple of capital on our investment since our recapitalization in 2015.
This transaction, when combined with the financing completed in advance of the sale, will have generated total proceeds of over $900 million in the last 18 months. The net proceeds received from the sale represents a 1.8x multiple of our current carrying value.
We initially acquired a 27% stake in the pipeline through the purchase of Babcock & Brown Infrastructure. In 2015, we opportunistically increased our ownership to 50%, partnering with another operator to buy out a consortium of minority owners, successfully recapitalizing the business. During our ownership, we executed our business plans to create value primarily through organic growth. This included pipeline expansions into key regions to connect natural gas supply to utility providers and LNG export facilities, as well as upgrades across the existing pipeline network to increase capacity. Brookfield Infrastructure engaged CIBC Capital Markets and RBC Capital Markets as joint financial advisors in the transaction and Vinson & Elkins LLP as legal advisor.
In further asset sale updates, Brookfield Infrastructure has completed the first step in the stabilized data center monetization strategy, signing an agreement to sell a 30% interest in a 244-megawatt portfolio of de-risked and operating sites in Europe to a financial sponsor for approximately $460 million in proceeds (approximately $90 million net to BIP). We are also progressing the sale of an additional 60% stake in the portfolio, which we hope to sign in the coming months.
“Securing these two transactions adds to the excellent start we have had to the year. We have now locked in over $700 million in proceeds from asset sales since the beginning of the year, which is expected to increase to nearly $900 million shortly following the sell down of the additional stake in our European data center portfolio,” said Sam Pollock, Chief Executive Officer of Brookfield Infrastructure. “This marks meaningful progress towards our asset monetization goal of $5 to $6 billion over the next two years, and we continue to experience strong activity levels and buyer interest in our in-progress capital recycling initiatives, with more to come.”
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.