GCP Infrastructure and GABI cease tie-up talks (updated)
18/09/2023 07:50
(Adds detail and quotes)
By Tom Wilson
LONDON, Sept 18 (Reuters) - GCP Infrastructure
Investments GCPI.L is no longer in discussions on a proposed
tie-up with GCP Asset Backed Income Fund (GABI) GABIG.L .
The investor in UK infrastructure projects last month said
it had struck a deal to acquire GABI's assets and was in talks
with RM Infrastructure Income RMII.L about a potential
combination.
The proposed deal between the two investment funds would
have resulted in the shareholders of GABI, which invests in
sectors from student accommodation to residential developments,
taking a stake in GCP Infra. Both funds are managed by Gravis
Capital.
On Monday GCP Infra said its board had no desire "to create
an enlarged entity with a significant minority of investors in
such entity opposed to it", adding that there was a "divergence
of views" among GABI shareholders on the merits of the tie-up.
GCP Infra said its priorities for using its cash reserves
remain reduction of its 104 million pounds ($129 million) of
debt to "as low as possible" and to buy back its shares while
they trade at a discount to its net asset value per ordinary
share.
"Given these alternatives, the threshold for new investment
activity remains a high hurdle," it said.
($1 = 0.8065 pounds)
(Reporting by Tom Wilson
Editing by Dhara Ranasinghe
Editing by David Goodman)
((T.Wilson@thomsonreuters.com; Twitter: @tomwilson1983; Reuters
Messaging: t.wilson.thomsonreuters.com@reuters.net))