HICL Announces Strategic Portfolio Sale to APG

HICL Announces Strategic Portfolio Sale to APG

HICL continues to deliver on its strategy with the sale of a portfolio of seven UK PPP assets to APG, the largest Dutch pension services provider, for a total consideration of approximately £225 million.

This strategic transaction reflects HICL’s ongoing approach to portfolio management and value realisation. The sale includes partial interests in Southmead Hospital and Pinderfields and Pontefract Hospitals, as well as full stakes in four UK LIFT projects and Edinburgh Schools. The valuation aligns with HICL’s 31 March 2025 figures and includes cash distributions received since 1 April. The majority of proceeds are expected at completion, with a £14 million non-contingent deferred payment due by 30 June 2026, which may be brought forward.

Proceeds are intended to support HICL’s £150 million share buyback programme, repay the revolving credit facility, and meet approximately £110 million in outstanding equity commitments. Including this transaction, HICL has completed around £725 million in asset sales over the past two years. Following completion, healthcare exposure is expected to reduce from 22% to 16% of gross portfolio value.

Southmead Hospital and Pinderfields and Pontefract Hospitals are the largest assets in the sale, with HICL retaining 31.25% and 50% shareholdings respectively. InfraRed has worked closely with NHS Trusts on both projects to deliver capital improvements. At Southmead, InfraRed also undertook significant risk mitigation following Carillion’s liquidation in 2018.

InfraRed will continue to manage the assets on behalf of APG under a separately managed account. While not a related party transaction under UK Listing Rules, the Board followed best governance practices, with an independent non-executive Director joining the Investment Committee throughout. The Board reviewed and approved the terms, having been advised by Investec Bank plc on their fairness to shareholders.

The transaction also establishes a new partnership framework between HICL and APG, creating opportunities for future divestments and co-investment in new assets.

Mike Bane, Chair of HICL, commented:

“We are pleased to announce another material disposal for the Company, which again highlights both the quality of HICL’s underlying portfolio and a consistent ability to execute divestments at attractive valuations. In the last two years, the Company has raised over £725m through disposals, enabling the Board to deliver on its capital allocation priorities for the benefit of shareholders.”

Edward Hunt, Head of Core Income Funds at InfraRed, added:

“This is another important transaction delivered by InfraRed in support of the Board’s objectives. The sale improves key portfolio metrics for HICL and reflects InfraRed’s ability to execute highly targeted divestments. It also reinforces the through-cycle attractiveness of high-quality infrastructure assets, with pricing that underscores the Company’s robust NAV and highlights the continued dislocation between public and private markets.”