Macquarie International Infrastructure Fund Limited EC36305 Penboss Building 50 Parliament Street 2nd Floor Hamilton HM 12 BERMUDA Telephone +65 6601 0777 Fax +65 6601 0653 Internet www.macquarie.com/miif SGX-ST Release Macquarie International Infrastructure Fund Limited (MIIF) MIIF AGREES TO SELL ENTIRE INTEREST IN HUA NAN EXPRESSWAY Singapore, 15 May 2015 Macquarie International Infrastructure Fund Limited ( MIIF ) today announced that it has agreed to sell its 81.0 per cent effective interest in Hua Nan Expressway ( HNE ) for a total cash consideration of S$110.0 million (the Proposed ). The Proposed will be made to Topwise Consultants Limited ( Topwise ), an existing shareholder of HNE. The Proposed is subject to MIIF shareholders ( Shareholders ) approval at a Special General Meeting ( SGM ) to be convened. A circular, together with a notice of the SGM, will be despatched to Shareholders in due course. The Proposed was negotiated on an arm s length commercial basis and follows an extensive sales process undertaken by MIIF, with the advice of Citigroup Global Markets Asia Limited. The Proposed represents the best offer received by MIIF. The Proposed is in line with the strategy to maximise returns to Shareholders announced by the MIIF Board in December 2012 and endorsed by Shareholders in March 2013. The pursuit of this strategy has resulted in the successful divestments of MIIF's interests in Taiwan Broadband Communications, Changshu Xinghua Port and Miaoli Wind, and the distribution of proceeds from these divestments to Shareholders. Should Shareholders approval be given to pursue the Proposed, MIIF intends to distribute the net proceeds and any residual cash following the settlement of its liabilities to Shareholders by way of a redemption of ordinary shares in the capital of MIIF ( Share Redemption ). The total proceeds to be distributed to Shareholders following the Proposed are expected to be approximately 8.25 Singapore cents per share ( cps ). Should the Proposed and distribution by way of the Share Redemption complete, MIIF will be delisted from the Singapore Exchange Securities Trading Limited and wound up. Upon completion of MIIF s strategy to maximise returns to Shareholders, MIIF would have delivered total net proceeds of approximately 66.4 1 Singapore cps to 1 Excludes ordinary dividends paid from October 2012 to date None of the entities noted in this document is an authorised deposit-taking institution for the purposes of the Banking Act 1959 (Commonwealth of Australia). The obligations of these entities do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542 (MBL). MBL does not guarantee or otherwise provide assurance in respect of the obligations of these entities.
Macquarie International Infrastructure Fund Limited Shareholders, arising from the implementation of the strategy. This is 24.0 per cent higher than MIIF s share price of 53.5 Singapore cps when the review of MIIF s strategy was first announced in October 2012. In addition, MIIF also distributed a total of 5.15 Singapore cps of ordinary dividends from October 2012 to date, thereby delivering a total return of 33.6 per cent to Shareholders. The MIIF Board has engaged KPMG Corporate Finance Pte Ltd ( KPMG ) to act as an independent financial advisor to opine on the fairness and reasonableness of the transaction. KPMG's opinion would form part of the circular to be issued to Shareholders in due course. In accordance with MIIF's continuous disclosure obligations, MIIF will keep the market appropriately informed of further developments. Shareholders Approval As the relative figures under Rules 1006(a), (b) and (c) of the listing manual of the Singapore Exchange Securities Trading Limited (the Listing Manual ) exceed 20 per cent, the Proposed constitutes a major transaction for MIIF as defined in Chapter 10 of the Listing Manual for which Shareholders approval will need to be sought. Please refer to Appendix 1 which forms part of this announcement for further details. Disclosure of Interest None of the directors and substantial shareholders of MIIF (other than in his or her or its capacity as a Shareholder) has any interest, direct or indirect, in the Proposed. About HNE HNE is a 31-kilometre dual-carriage urban toll road in the city of Guangzhou, the capital of Guangdong province in China. HNE has the exclusive right to operate and collect tolls up to 2026. It is the main artery for north-south traffic in Guangzhou. HNE is MIIF s sole remaining investment. Documents on Display A copy of the sale and purchase agreement dated 14 May 2015 is available for inspection during normal business hours at the registered office of MIIF at Penboss Building, 50 Parliament Street, 2 nd Floor, Hamilton HM 12, Bermuda and the offices of Allen & Gledhill LLP at One Marina Boulevard #28-00, Singapore 018989 from the date of this announcement up to and including the date falling three months after the date of this announcement. For further information, please contact: Andrew Yeoh Fiona McDonald Investor Relations, Singapore Corporate Communications, Hong Kong Tel: (65) 6601 0765 Tel: (852) 3922 3591 Email: andrew.yeoh@macquarie.com Email: fiona.mcdonald@macquarie.com
The disclosures pursuant to Rule 1010 of the listing manual (the Listing Manual ) of the Singapore Exchange Securities Trading Limited (the SGX-ST ) are as follows: (1) Particulars of the assets acquired or disposed of, including the name of any company or business, where applicable; Macquarie International Infrastructure Fund ( MIIF ) has agreed to sell its 90.0% shareholding interest in South China Highway Development (H.K.) Ltd ( SCHK ) (the Disposed Interest ), which has a 90.0% interest in Hua Nan Expressway ( HNE ). Accordingly, MIIF has an 81.0% effective interest in HNE. This represents MIIF s entire interest in HNE (the Proposed ). (2) A description of the trade carried on, if any; HNE is a 31-kilometre dual-carriage urban toll road in the city of Guangzhou, the capital of Guangdong province in China. HNE has the exclusive right to operate and collect tolls up to 2026. It is the main artery for north-south traffic in Guangzhou. HNE is MIIF s sole remaining investment. (3) The aggregate value of the consideration, stating factors taken into account in arriving at it and how it will be satisfied, including the terms of payment; The total cash consideration is S$110.0 million (the Consideration ) 1. (4) Whether there are any material conditions attaching to the transaction including a put, call or other option and details thereof; The divestment is subject to MIIF shareholders ( Shareholders ) approval at a Special General Meeting ( SGM ) to be convened. (5) The value (book value, net tangible asset value and the latest available open market value) of the assets being acquired or disposed of, and in respect of the latest available valuation, the value placed on the assets, the party who commissioned the valuation and the basis and the date of such valuation; As a result of MIIF s agreement to pursue the Proposed, the book value of HNE as at 31 March 2015 has been adjusted to reflect the total cash consideration for the Proposed of S$110.0 million. Accordingly, in MIIF s financial report for the three months ended 31 March 2015, the book value and net tangible asset value of MIIF s interest in HNE as at 31 March 2015 equals the Consideration. 1 The Consideration excludes transaction costs.
(6) In the case of a disposal, the excess or deficit of the proceeds over the book value, and the intended use of the sale proceeds. In the case of an acquisition, the source(s) of funds for the acquisition; (7) The net profits attributable to the assets being acquired or disposed of. In the case of a disposal, the amount of any gain or loss on disposal; As at 31 March 2015, the book value of MIIF s interest in HNE is at the Consideration amount of S$110.0 million. Prior to the signing of the Sale and Purchase Agreement, the book value of MIIF s interest in HNE as at 31 December 2014 was S$120.2 million. Based on the valuation of MIIF s interest in HNE as at 31 December 2014, the Consideration represents a loss of S$10.2 million to MIIF. The Proposed is in line with the strategy to maximise returns to Shareholders announced by the MIIF Board in December 2012 and endorsed by Shareholders in March 2013. The pursuit of this strategy has resulted in the successful divestments of MIIF's interests in Taiwan Broadband Communications ( TBC ), Changshu Xinghua Port ( CXP ) and Miaoli Wind, and the distribution of proceeds from these divestments to Shareholders. Should Shareholders approval be given to pursue the Proposed, MIIF intends to distribute the net proceeds and any residual cash following the settlement of its liabilities to Shareholders by way of a redemption of ordinary shares in the capital of MIIF ( Share Redemption ). The total proceeds to be distributed to Shareholders following the Proposed are expected to be approximately 8.25 Singapore cents per share ( cps ). As a result of MIIF s agreement to pursue the Proposed, the book value of HNE as at 31 March 2015 has been adjusted to reflect the total cash consideration for the Proposed of S$110.0 million. Accordingly, in MIIF s financial report for the three months ended 31 March 2015, the book value and net tangible asset value of MIIF s interest in HNE as at 31 March 2015 equals the Consideration. The net loss before tax, non-controlling interests and exceptional items attributable to HNE for the three months ended 31 March 2015 is S$10.2 million 2. (8) The effect of the transaction on the net tangible assets per share of the issuer for the most recently completed financial year, assuming that the transaction had been effected at the end of that financial year; Assuming that the Proposed had been completed on 31 December 2014, the effect on the NTA per share of MIIF and its subsidiaries (the MIIF Group ) as at 31 December 2014 would be as follows: Before the Proposed After the Proposed NTA (S$ 000) 130,114 100,401 MIIF Shares in issue on 31 December 2014 ( 000) 1,149,857 1,149,857 NTA per MIIF Share (S$) 0.11 0.09 The decrease in NTA per MIIF Share from the Proposed is due to the Consideration being lower than the valuation of MIIF s interest in HNE as at 31 December 2014 of S$120.2 million by S$10.2 million and accruals of the 2 As disclosed in its Review of Net Income on an Adjusted Basis, page 7 of MIIF s SGX Quarterly report for the quarter ended 31 March 2015.
estimated success fee of S$17.4 million payable to MIIF s manager, Macquarie Infrastructure Management (Asia) Pty Limited ( MIMAL ), upon the successful divestment of MIIF s assets and estimated transaction costs of S$2.1 million relating to the Proposed. (9) The effect of the transaction on the earnings per share of the issuer for the most recently completed financial year, assuming that the transaction had been effected at the beginning of that financial year; Assuming that the Proposed had been completed on 1 January 2014, the effect on the earnings per share of the MIIF Group for the year ended 31 December 2014 would be as follows: Before the Proposed After the Proposed Loss after tax attributable to owners of the parent (S$ 000) (32,836) (62,549) Weighted average number of MIIF Shares in issue ( 000) 1,149,857 1,149,857 Earnings per MIIF Share (S$) (0.029) (0.054) The decrease in earnings per MIIF Share from the Proposed is mainly due to: - the reversal of the loss on valuation of HNE in FY2014 of S$22.6 million, being more than offset by - the S$32.8 million loss recorded on the Proposed of MIIF s interest in HNE at the Consideration amount of S$110.0 million, and - the accruals of the estimated success fee and estimated transaction costs relating to the Proposed. (10) The rationale for that transaction including the benefits which are expected to accrue to the issuer as a result of the transaction; (11) Whether any director or controlling shareholder has any interest, direct or indirect, in the transaction and the nature of such interests; The Proposed is in line with the strategy to maximise returns to Shareholders announced by the MIIF Board in December 2012 and endorsed by Shareholders in March 2013. The pursuit of this strategy has resulted in the successful divestments of MIIF's interests in TBC, CXP and Miaoli Wind, and the distribution of proceeds from these divestments to Shareholders. The Proposed was negotiated on an arm s length commercial basis and follows an extensive sales process undertaken by MIIF, with the advice of Citigroup Global Markets Asia Limited. The Proposed represents the best offer received by MIIF. None of the directors and substantial shareholders of MIIF (other than in his or her or its capacity as a Shareholder) has any interest, direct or indirect, in the Proposed. About HNE HNE is a 31-kilometre dual-carriage urban toll road in the city of Guangzhou, the capital of Guangdong province in China. HNE has the exclusive right to operate and collect tolls up to 2026. It is the main artery for north-south traffic in Guangzhou. HNE is MIIF s sole remaining investment.
For more information on HNE please refer to MIIF s website at www.macquarie.com/miif. About MIIF MIIF, a Bermuda-registered mutual fund company, was listed on the Main Board of the SGX-ST, on 27 May 2005. (12) Details of any service contracts of the directors proposed to be appointed to the issuer in connection with the transaction; and (13) The relative figures that were computed on the bases set out in Rule 1006. None The relative figures for the divestment computed on the bases set out in Rule 1006 ( Rule 1006 ) of the Listing Manual are as follows: Rule 1006 Bases Relative Figures (%) (1) (a) Net asset value of MIIF s interest in HNE, compared with the MIIF Group s net asset value 108.7% (b) (c) (d) (e) Net profits attributable to MIIF s interest in HNE compared with the MIIF Group s 33.2% net profits Aggregate value of the consideration received for the Proposed compared with MIIF s market capitalisation based on the total number of issued 113.9% MIIF Shares excluding treasury shares (2) Number of equity securities issued by MIIF as consideration for an acquisition, compared with the number of equity securities previously in issue Aggregate volume or amount of proved and probable reserves to be disposed of, compared with the aggregate of the MIIF Group s proved and probable reserves Not applicable Not applicable Notes: (1) The relative figures presented are based on MIIF s latest announced results for the period ended 31 March 2015. (2) MIIF s market capitalisation is based on 1,149,857,154 MIIF Shares in issue as at 14 May 2015 at a volume weighted average price of 8.4 Singapore cps at the close of trading on 14 May 2015 for each MIIF Share.