Land Securities buys PPP firm for EUR 798 mln

Land Securities Trillium (LST), the property partnership unit of British property giant Land Securities, has completed the acquisition of the specialist public private partnership (PPP) firm Secondary Market Infrastructure Fund (SMIF) for £527 mln (EUR 798 mln). The sellers were STAR Capital Partners, Halifax Bank of Scotland and AMP Capital. Land Securities. LST assumed SMIF's net debt of about £400 mln.

The acquisition of SMIF gives LST an equity holding in 79 additional PPP projects, totalling 2.34 mln m² of accommodation. Some 80% of the portfolio comprises public service buildings such as schools, hospitals and prisons. The rest of the portfolio is made up of infrastructure assets such as highway maintenance and a stake in a water company.

'This acquisition positions LST as a leading player in the public private partnership market,' said Ian Ellis, ceo of LST. 'Our entry into the sector, just 12 months ago, with our investment in Investors in the Community ensured our position in the primary PPP market. This latest investment in SMIF now gives us access to the secondary PPP market. The two sectors are showing increasing convergence and our collective interests amount to some 100 PPP projects. Our combined expertise in this emerging market will provide our customers with some of the strongest experience in the industry.'

LST said it aims to substantially reduce the capital invested in SMIF through the disposal of its interest in mature projects, while maintaining minority stakes and ongoing asset management responsibility. The company said it will also continue to build on SMIF's track record of acquiring PPP interests.