The State-backed Infrastructure Investment Fund (IIF) confirmed on Thursday it has agreed to sell three of four of its assets to UK infrastructure investor John Laing in a deal estimated to be worth about €1 billion.
The planned transaction comprises a contract to operate the Convention Centre Dublin, telecoms towers business Towercom, and primary healthcare firm Valley Healthcare, both sides of the transaction said in a statement, which did not give finance details.
The IIF, which is managed by Australia’s AMP Capital, is still courting bidders for its remaining asset, fibre networks company Enet.
The deal is the biggest in the history of John Laing, which traces its roots back to 1848 and was taken over by US private equity giant KKR last year.
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The €1 billion price tag for the three assets being sold to John Laing equates to the amount that the IIF was expected to achieve for all four parts of its portfolio when it was put on the market over the summer.
“This acquisition, the largest single investment in John Laing’s history, enables us to scale and diversify our portfolio with three assets that enjoy strong market positions and limited correlation to economic cycles, all underpinned by long-term contracts,” said Jamie Christmas, acting chief executive of John Laing.
“We are also excited by the chance to invest in Ireland, the fastest-growing economy in the euro zone and a country where we expect to see a pipeline of further investment opportunities.”
AMP Capital fund manager and IIF principal Philip Doyle said: “IIF was established to support the Irish economy through investment into essential community and national infrastructure and services. We are pleased that through our active management of these businesses they have grown and prospered during our tenure.”
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IIF was set up by Irish Life Investment Managers in 2011, with €250 million of backing from the State’s Ireland Strategic Investment Fund, then known as the National Pensions Reserve Fund. AMP was appointed as the discretionary manager of the fund, which has about 20 investors.
The Irish Times reported last month that John Laing had been selected as the preferred bidder for the three IIF assets.
The IIF started off in 2012 by buying wind farm assets from Energia Group (then known as Viridian) that would ultimately be sold again. In 2013, it purchased Towercom, with a portfolio of 409 telecom towers, from clients of Goodbody Stockbrokers.
In 2015, the fund acquired a licence to operate the Convention Centre Dublin, which has a capacity for 8,000 people, until 2035 from the receivers of Treasury Holdings. Two years later, the IIF moved to buy control of Enet, which operates fibre optic infrastructure known as the metropolitan area networks on behalf of the State in 94 towns and cities.
That same year, the fund set up Valley Healthcare. That business has 20 operating healthcare centres, with a further six in development.
AMP Capital and leading IIF investors began to consider the long-term future of the fund three years ago, sources previously said, with options including raising more money to continue to invest even amid heightened competition for assets from overseas investment funds, or a sale of the portfolio.
While a formal decision to sell was only made earlier this year, there was a general consensus by the end of 2020 that this would be the outcome, the sources said.
However, the review also occurred against the backdrop of the fallout from revelations in 2020 that Boe Pahari, who was hired a decade earlier to head AMP Capital’s European infrastructure business and led some of the early IIF deals, had been promoted as head AMP Capital even though the wider AMP Group knew he had settled a sexual harassment claim brought by a woman colleague. Mr Pahari left AMP Capital in April 2021.
