BCI Takes BBGI Global Infrastructure Private, Completes Sale of Hayfin
Canada’s BCI, one of the country’s largest asset managers, will buy BBGI Global Infrastructure S.A. in a deal valuing the Luxembourg-based investment firm at £1.06-billion ($1.32-billion), the companies said on Thursday.
BCI’s offer for BBGI of 147.5 pence per share in cash, represents a premium of 21 per cent to the London-listed stock’s closing price on Wednesday. BBGI’s shares rose nearly 19 per cent to 144.8 pence in early trading, their highest level since June 2023.
BBGI, whose stock price had fallen 12 per cent in 2024, has grown to become one of the U.K.’s largest listed infrastructure funds with a portfolio which includes projects such as bridges and tunnels, as well as education and health care facilities.
It is the latest London-listed company to be bought or become the target of either overseas buyers or private equity as Britain’s Labour government rushes to roll back stringent regulations to attract global investments.
BBGI said its board has recommended that shareholders vote in favour of the acquisition by BCI, which previously bought Compre, a London-based specialist in buying and managing non-life insurance portfolios, with Cinven in 2020.
Oliver Haill of Collective Investments also reports BBGI Global Infrastructure agrees takeover by Canadian pension fund:
BBGI Global Infrastructure SA (LSE:BBGI) has received a £1.6 billion all-cash offer from Canadian pension fund manager British Columbia Investment Management (BCI).
BBGI's board has agreed to the terms of a deal, whereby shareholders will be entitled to receive 147.5p per share in cash, a premium of 21% to yesterday's closing price.
The offer also values the infrastructure-focused investment company at a premium of 3.4% to the estimated net asset value per share of 142.7p as at 31 December.
If BBGI declares an interim dividend in respect of the six months to December or makes any other distribution, the offer may be reduced by that amount.
Duncan Ball, chief executive officer of BBGI, noted BBGI has grown to become one of the UK's largest listed infrastructure funds, with a globally-diversified portfolio of 56 infrastructure assets that deliver long-term index-linked cash flows, and since its creation in 2011 has delivered a total net asset value return of 176.3%.
"Although both the BBGI supervisory board and the BBGI management board are confident that BBGI can continue to deliver sustainable cash flows to BBGI shareholders, the offer from BCI represents a premium to undisturbed share price and to net asset value, and provides BBGI shareholders with the opportunity to realise the value of their holdings in cash, at an attractive value in excess of the reasonable medium term prospects for BBGI on a standalone basis."
As a result, he said both the supervisory Board and management board have concluded that the offer "is in the best interests of BBGI shareholders and BBGI as a whole".
BCI manages assets worth C$250 billion in gross assets on behalf of its British Columbia public pension fund and institutional clients.
Last week, BCI issued a short press release on the take-private offer to BBGI Global Infrastructure SA:
BCI is pleased to announce, alongside BBGI Global Infrastructure S.A. (“BBGI”), that it has made a cash offer to take BBGI private.
“We believe BBGI will be a compelling and strategic addition to BCI’s Infrastructure & Renewable Resources portfolio, with a diversified mix of international holdings across the transport, clean energy, healthcare, education and social infrastructure sectors. We see many opportunities to leverage our expertise, global relationships, and access to long-term capital, alongside BBGI’s experienced management team and proven asset management strategies, to drive further growth and value creation across the BBGI portfolio.”
— Grant Hodgkins, Senior Director, Infrastructure & Renewable Resources, BCI.
More information about the offer can be found in the offer announcement here.
A brief description of BBGI Global Infrastructure S.A. is available on Yahoo Finance:
BBGI Global Infrastructure S.A. is an investment firm specializing in infrastructure investments in operational or near operational assets. It seeks to invest in Public Private Partnerships (PPP) and Private Finance Initiative (PFI) infrastructure assets. The firm typically invests in ‘availability-based' projects including schools, hospitals, prisons, transportation, justice, education, healthcare , emergency services and certain roads infrastructures. It seeks to invest in Europe, North America, Australia, and New Zealand; but will consider other markets. The firm's investments in under construction projects and demand based assets will be limited to maximum 25 percent of portfolio value. In addition, no more than 25 percent of the portfolio value calculated at the time of investment will be derived from projects whose revenue streams are not public sector or government-backed and any new acquisition will generally not have an acquisition value greater than 20 percent of the portfolio value immediately post-acquisition. It also has a single asset target limit of 20 percent of portfolio, subject to 25 percent maximum. It was formerly known as BBGI Sicav S.A. The firm may use leverage to finance acquisition of new investments. BBGI Global Infrastructure S.A. is based in Senningerberg, Luxembourg.
With this take-private deal, BCI will grow its global infrastructure portfolio and use BBGI's experienced management team to add more assets as they come available.
Obviously they did their due diligence and liked what they saw or else they wouldn't have tendered an offer.
There are quite a few listed infrastructure companies in the UK and Europe and while it's rare to see these type of take-private deals, if they valuations make sense, why not?
In other news, BCI today announced the completion of its majority stake in Hayfin:
VICTORIA (BC), LONDON & NEW YORK, February 10, 2025 – British Columbia Investment Management Corporation (“BCI”), one of Canada’s largest institutional investors, today announced it has completed the sale of its majority stake in Hayfin Capital Management (“Hayfin”) to Arctos Partners (“Arctos”), a private investment firm. BCI remains a significant and strategic limited partner in certain key Hayfin fund strategies. Hayfin’s management team was instrumental in leading the sale process to select Arctos as the preferred partner for the next stage of growth.
“Seven years ago, we identified a unique opportunity early in the cycle to invest in the secular tailwinds behind private credit and back Hayfin’s growth by supporting the expansion of its platform capabilities and strategies,” said Jim Pittman, Executive Vice President & Global Head of Private Equity at BCI. “We are pleased with the impact our strategic efforts have had in building Hayfin into a preeminent European alternative asset management firm, increasing its assets under management from €8 billion at the time of BCI’s initial investment to over €33 billion today, leading to this successful investment outcome for BCI’s clients.”
“Through our Principal Credit Fund, BCI has provided strong support for Hayfin’s direct lending and tactical credit strategies, helping these programs to meaningfully scale. We continue to view Hayfin as a core private credit strategic partner in Europe,” said Daniel Garant, Executive Vice President & Global Head of Public Markets at BCI.
BCI acquired a majority stake in Hayfin in 2017, after spotting an emerging trend for long-term growth in the European market for private credit asset management, driven by regulatory and structural demand trends. Through the course of its ownership, BCI worked with Hayfin management to grow the investment teams, build its partner solutions function and enhance platform capabilities to ensure stable asset management and superior risk-adjusted performance. BCI became a key strategic partner in Hayfin’s core private credit franchise and helped enable the platform’s expansion into further complementary strategies.
The private credit market has experienced a critical period of significant growth over the past seven years and the recent industry consolidation trends presented a compelling opportunity for BCI to sell its majority stake, allowing the realization of investment returns for its clients.
On July 30, 2024, BCI announced it entered into a definitive agreement to sell its majority stake in Hayfin to Arctos. All regulatory approvals have been secured and the transaction was completed on February 7, 2025.
BCI Private Equity has a long-established presence in Europe through notable direct investments in multiple industry-leading companies such as BMS Group, ZEDRA, Refresco, Compre Group and Waterlogic, where it brings its capital and operational expertise to bear. With a growing portfolio of companies and fund partners in Europe, BCI intends to continue expanding the footprint of its private equity program in this critical region. Our experience in Hayfin and other European-based companies positions us well for future growth and significant investment opportunities in the region.
About BCI
British Columbia Investment Management Corporation (BCI) is amongst the largest institutional investors in Canada, with C$250.4 billion in gross assets under management as of March 31, 2024. Based in Victoria, British Columbia, with offices in Vancouver, New York, and London, U.K., BCI manages a portfolio of diversified public and private market investments on behalf of its British Columbia pension fund and institutional clients.
BCI’s private equity program actively manages a C$31 billion global portfolio of privately held companies and funds with the potential for long-term growth and value creation. Leveraging our sector-focused teams in business services, consumer, financial services, healthcare, industrials, technology, media and telecommunications, we work with strategic private equity partners to source and manage direct and co-sponsor/co-investment opportunities.
The investment in Hayfin goes back to when Jim Pittman and Gordon Fyfe were working at PSP and they bought the majority stake (from PSP, OMERS, Future Fund) knowing the company very well.
I wrote about the sale last July here.
This has been one of the better, if not the best investment BCI ever made, and it's all about timing (got in early before private credit took off and are now realizing on their investment close to the top).
Below, an older (2021) interview where (then) BBGI Global Infrastructure SA joint CEOs Frank Schramm and Duncan Ball joined Proactive London to talk about their investment strategy.
And four months ago, Duncan Ball, CEO of BBGI Global Infrastructure discussed the projects they are involved in from roads to healthcare, and the steps they are taking to embrace ESG and empower staff on the Be Inspired series.
He also discusses why listing on the London Stock Exchange was the right fit for BBGI and their investors, and the benefits of internal management for the business.
He said they grew the portfolio from 19 assets to over 56 assets and never sold an asset and explains the themes that offered a nice tailwind.
Good interviews, gives you a good idea about what BBGI Global Infrastructure SA does and why BCI took it private.
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