If you can’t find the answer to your question below, please contact HICL's Administrator & Company Secretary whose contact details are available here.
These FAQs are general in nature and are not intended to provide specific investment, financial, legal, accounting or tax advice, nor do they seek to make any recommendations about the suitability of HICL shares for any particular investor. If you require any such advice, please consult a suitably qualified professional adviser.
No. HICL UK intends to conduct its affairs as an investment trust. On this basis, the Ordinary Shares should qualify as an "excluded security" and therefore be excluded from the FCA's restrictions in COBS 4.12 of the FCA Handbook that apply to non-mainstream pooled investment products.
HICL is a member of The Association of Investment Companies (“AIC”). Ongoing Charges, in accordance with AIC guidance, are defined as annualised ongoing charges (i.e. excluding acquisition costs and other non-recurring items) divided by the average published undiluted net asset value in the period. On this basis, the Company’s Ongoing Charges Percentage for each of the last five financial years is set out in Financial Performance.
There are no performance fees paid to any service provider.
Further information regarding The Association of Investment Companies may be found via the following external link; www.theaic.co.uk.
The Company does not have a benchmark per se, but the FTSE 250 and FTSE All Share indices are used to show relative performance.
The Company’s ticker is HICL:LN, and its ISIN and SEDOL codes are GB00BJLP1Y77 and BJLP1Y7, respectively.
The Company’s annual results will normally be published in May (in respect of its financial year ended 31 March) and its interim results will normally be published in November (in respect of the six months ended 30 September). Please refer to the Corporate Calendar for further information.
Investment Manager: InfraRed Capital Partners Limited
Administrator & Company Secretary: Aztec Financial Services (UK) Limited
Joint brokers: Investec Bank plc and RBC Capital Markets
Financial PR: Teneo Strategy Limited
Registrar: Link Asset Services
Auditor: KPMG LLP
Some commonly-used acronyms appear throughout the website. An explanation of what each stands for and its general meaning is as follows:
ESG – ‘Environmental, Social & Governance’, is the catch-all term for the criteria used in socially-responsible investing. It refers to the three main areas of concern that have developed as central factors in measuring the sustainability and ethical impact of an investment in a company or business.
FM – ‘Facilities Management’, an interdisciplinary field devoted to the integration of the planning, development and management of a wide range of services, both ‘Hard’ (e.g. building fabric) and ‘Soft’ (e.g. catering, cleaning, security, mailroom, and health & safety), that the client has contracted the private sector to perform for the asset. The ultimate aim of the FM activities is to facilitate and improve the effectiveness of an infrastructure asset’s primary activities vis-a-vis its end users (e.g. teachers and children in a school; or doctors, nurses and patients in a hospital).
IPO – ‘Initial Public Offering’, being the first sale of Company’s shares to the public and date of its launch on the London Stock Exchange.
KPI – ‘Key Performance Indicators’, a set of quantifiable measures used to gauge or compare performance in terms of meeting their strategic and/or operational goals. In an infrastructure project, KPIs are commonly-used for measuring the success of the supply chain relative to the standards of the client, as stipulated in the project contracts. An example might be maintaining the building temperature within a certain range, or answering help desk queries within a specified time period.
PPP / PFI – Please see ‘Portfolio & Investment’ tab above.
SPV – ‘Special Purpose Vehicle’, also more generally referred to as a ‘project company’, is a legal entity (usually a limited company) established by the private sector to act as the contracting party with the public sector client with respect to the arrangements relating to the infrastructure asset. Equity funders such as the Company will comprise the shareholders. As the entity contracting with the client to finance, construct and operate the relevant infrastructure asset, the SPV will also be the counterparty to the supply chain entities (construction and FM parties) and the debt financers. A unique SPV will be used for each infrastructure project to avoid any ‘cross-contamination’ of assets or liabilities between the different projects.
Iconography is used in the Portfolio section of the website to provide users with a quick visual ‘flag’ for a project’s status or sector designation, as follows:
An infrastructure project which is in its construction phase
An infrastructure project which is in its operational phase
An infrastructure project servicing accommodation needs
An infrastructure project servicing education needs
An infrastructure project servicing fire, law & order needs
An infrastructure project servicing health needs
An infrastructure project servicing transport needs
An infrastructure project servicing water needs
Portfolio & Investment
Infrastructure may be defined as the fundamental services and systems serving a country, city or area, for example transportation and communication systems, power plants and social buildings (such as schools and hospitals). Further details are available in the Primer Papers.
Public–Private Partnerships (PPPs / P3s) are a model of public procurement whereby the funding and operation of a public infrastructure service or project is achieved through the involvement of private sector capital and expertise. The service or project is structured through a partnership of the government on the one hand, and one or more private sector organisations (known as the consortium), via a specific ‘Project Company’, on the other.
A PPP involves a contract between the public sector authority and the Project Company, in which the Project Company provides the infrastructure service or project - such as a hospital, school or transport link - and assumes substantial and long-term financial, technical and operational risk in the venture. The Project Company will in turn sub-contract the various responsibilities and risks inherent in the project to each of the underlying consortium members, as applicable. In return for fulfilling this role, the Project Company will receive a revenue stream from the procuring public sector client in the form of a regular ‘Unitary Payment’ which is used to meet the operational costs of the infrastructure project, service the debt financing obligations and reward equity investors such as HICL.
While the United Kingdom was first to make systematic use of a PPP model, in the form of the Private Finance Initiative (PFI), PPPs have now been adopted in many countries as part of the wider programme of privatisation, driven by an increased need for accountability and efficiency for public spending.
Further details of the arrangements for, and the economics of, infrastructure investment are available in Strategy and Investment Policy.
HICL shares are eligible for inclusion in NISA/ISAs and PEPs (subject to applicable subscription limits) provided that they have been acquired by purchase in the market.
It is expected that the Ordinary Shares will be eligible for inclusion in Investment –Regulated Pension Schemes including schemes formerly known as SIPPs (subject to the terms of the particular SIPP).
Under the investment trust "streaming" regime, HICL may designate dividends wholly or partly as interest distributions for UK tax purposes to the extent that it has "qualifying interest income".
The first interim dividend of HICL, expected to be declared by the directors of HICL in late May 2019 for payment in June 2019 in respect of HICL's accounting period ending 31 March 2019, will not be designated as an interest distribution for UK tax purposes. The directors of HICL currently expect to designate approximately 60 per cent. of the dividends in respect of the year ending 31 March 2020, commencing with the first interim dividend in that year which will be declared in July 2019 (payable in September 2019) as interest distributions. However, this treatment cannot be guaranteed and the decision on whether or not to designate dividends as interest distributions for any given accounting period will be taken by HICL on a case by case basis.
Potential investors should note that the UK tax treatment of HICL's dividends may vary for them depending on whether or not they are designated as interest distributions. Potential investors who are in any doubt about the tax treatment which will apply to them in respect of any dividends paid by HICL should consult their own professional advisers.
The Company’s shares are traded on the London Stock Exchange. If you are confident in making your own investment decisions you can do this by buying your shares directly through a stockbroker or through an execution-only dealing service. Your bank or building society may offer a dealing service; however, many alternatives are available so you should investigate which is best for your needs.
No representation regarding the suitability of HICL’s shares is intended or implied. If you require advice before you invest, an appropriate financial adviser should be consulted.
The Chairman, through Link Asset Services, writes to new shareholders periodically to ask if they require paper copies of the Company’s statutory documents or communications. If you do not elect to continue receiving paper copies, you will instead be sent a notification by post whenever a relevant document/communication is published on the Company’s website.
Alternatively, if you are happy to be removed from paper communication completely, and to just receive email notifications following the publication of statutory or other shareholder documentation, you can register your email address directly with Link Asset Services.
If you have not received a letter from Link Asset Services yet, or you wish to change your current preferences in respect of either of these services, instructions can be found in Shareholder Services.
HICL normally pays dividends on a quarterly basis, on or around the last business day in March, June, September and December of each year. It is expected that the quantum of each quarterly dividend will be approximately one-quarter of the forecast dividend for the year with the final quarterly dividend being adjusted as necessary.
It is HICL’s intention to conduct its affairs so that it satisfies the conditions necessary for it to be approved by HMRC as an investment trust under section 1158 of the Corporation Tax Act 2010 (CTA 2010). Assuming that this approval is obtained or maintained, HICL will be within a permitted category of property for selection by a policyholder in an investment bond, without such bond being treated for UK tax purposes as a personal portfolio bond.
The following comments are intended as a guide to the general stamp duty and stamp duty reserve tax (“SDRT”) position and do not relate to persons such as market makers, brokers, dealers, intermediaries and persons connected with depository arrangements or clearance services, to whom special rules apply.
No UK stamp duty or SDRT will be payable on the issue of HICL Shares.
Transfers on sale of HICL Shares outside of CREST will generally be subject to UK stamp duty at the rate of 0.5 per cent. of the consideration given for the transfer, rounded up to the nearest £5. The purchaser normally pays the stamp duty. An exemption from stamp duty is available for instruments transferring shares where the amount or value of the consideration is £1,000 or less and it is certified on the instrument that the transaction effected by it does not form part of a larger transaction or series of transactions in respect of which the aggregate amount or value of the consideration exceeds £1,000.
An agreement to transfer HICL Shares will normally give rise to a charge to SDRT at the rate of 0.5 per cent. of the amount or value of the consideration payable for the transfer. If a duly stamped transfer executed in pursuance of the agreement is produced within six years of the date on which the agreement is made (or, if the agreement is conditional, the date on which the agreement becomes unconditional) any SDRT paid is repayable, generally with interest, and otherwise the SDRT charge is cancelled. SDRT is, in general, payable by the purchaser.
Paperless transfers of HICL Shares within the CREST system will generally be liable to SDRT, rather than stamp duty, at the rate of 0.5 per cent. of the amount or value of the consideration payable. Such SDRT will generally be collected through the CREST system. Deposits of Ordinary Shares into CREST will not generally be subject to SDRT, unless the transfer into CREST is itself for consideration.
Transfers of HICL Shares to a company connected with the transferor will be subject to UK stamp duty or SDRT (as applicable) on the market value of the HICL Shares transferred, if this is higher than the consideration.
The Directors do not currently intend to offer a scrip dividend alternative (issuing new Ordinary Shares in lieu of a dividend to those Shareholders who elect to receive the same) in respect of dividends, because the principle advantages of scrip dividends for UK shareholders are not applicable in respect of UK-incorporated investment trusts such as HICL.
The Directors intend to make available a dividend reinvestment plan for Shareholders who wish to remain invested in HICL in lieu of receiving dividends. Any such plan will be provided by Link Asset Services (or such other provider as may be appointed from time to time). For more information and an application pack, Shareholders may call Link Asset Services on 0371 664 0381, email firstname.lastname@example.org or log on to the Share Portal.
Shareholders are advised to take their own tax and financial advice in relation to their participation in the dividend reinvestment plan. In particular, Shareholders should be aware that acquisitions of shares under the dividend reinvestment plan will be subject to UK stamp duty or SDRT in the same way as any other purchase of Ordinary Shares. Additionally, Shareholders will incur dealing charges in connection with such acquisitions.
Please refer to pages 86 to 91 of the March 2019 Prospectus. Please note that this section provides a generic overview of relevant UK tax issues at the time of the Prospectus’s issue (4 March 2019), and that investors should obtain their own specific and up to date financial and tax advice.
The Key Information Document can be found under Corporate Documents.