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HICL Infrastructure PLC on Monday said it has agreed a combination with Renewables Infrastructure Group Ltd, creating an investment firm with net assets above £5.3 billion, putting it on course for possible entry to the FTSE 100. The deal will see the voluntary winding up of Renewables Infrastructure, a trust which invests in assets generating electricity from renewable sources, with its assets transferred to HICL. London-based closed-ended infrastructure investment company HICL will issue new shares to Renewables Infrastructure shareholders, as well as a cash option. HICL will issue new shares based on the duo’s respective September 30 net asset values. The latest published NAVs would suggest HICL issues just over 0.7 shares to TRIG shareholders. HICL’s last reported NAV was for the end of March, but TRIG’s was for September 30. The cash option, meanwhile, is worth up to £250 million, representing around 11% of TRIG’s issued share capital. It will be priced at a 10% discount to TRIG’s September 30 NAV per share. Shares in HICL fell 7.8% to 108.70 pence each in London on Monday morning for a market value of £2.25 billion. Renewables Infrastructure Group traded 6.0% higher at 76.30p for a value of £1.71 billion. The combination has received backing from Sun Life, the parent company of InfraRed Capital Partners, which manages both trusts. It will buy £100 million worth of shares when the deal is done. HICL shareholders will own 56% of the combined firm, assuming the cash exit option is taken in full and based on the last published NAVs of the duo. InfraRed will remain the investment manager. HICL Chair Mike Bane said: ‘The combination of HICL and TRIG represents a unique opportunity to capture the key megatrends shaping the infrastructure market today, which increasingly straddle both core infrastructure and the energy transition.’ The enlarged trust is targeting an initial dividend target of 9.0 pence per share and NAV total return of over 10% per annum over the medium term supported by diversified and resilient cash flows. The two firms said the deal offers ‘strong strategic, operational and financial benefits for all shareholders,’ and ‘an opportunity to create the premier UK listed infrastructure investment company, with greater scale, liquidity and relevance to a broader investor base.’ ‘Its increased size is expected to improve share liquidity, broaden appeal to global institutional investors and index funds, and provide a pathway to potential inclusion in the FTSE 100 Index and other relevant global indices,’ the two firms added. Completion of the scheme is expected to occur in the first quarter of 2026. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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