Macquarie Atlas Roads Group

MQA Details

Acquisition of an additional 4.86% indirect interest in APRR:Macquarie Atlas Roads Group (ASX: MQA) has announced that it will exercise a pre-emptive right to acquire an additional 4.86% indirect interest in APRR for €440 million (the Acquisition). The Acquisition will increase MQA’s indirect interest in APRR from 20.14% to 25.0%. The Acquisition will be funded via A$450 million Offer, €150 million debt facility; and A$2 million corporate cash. APRR is the concessionaire of a 2,323km motorway network located in the east of France. The network acts as a vital transportation corridor for Western European trade, which is the second largest toll road network in France and the fourth largest in Europe. APRR has an established operating track record with over 50 years of traffic growth and proven earnings stability. The Acquisition is an opportunity for MQA to increase its ownership share in a core portfolio asset that has underpinned MQA’s portfolio value and distributions since its inception. Moreover, it provides a greater exposure to APRR’s favourable outlook and its leverage to French economic growth and trans-European trade. The group has also successfully completed the institutional component of its 1 for 6.62 underwritten pro-rata accelerated non-renounceable entitlement offer at the offer price of A$5.12 per new stapled security; and this represents the first stage of its A$450m equity raising. MQA has stated that proceeds of the Institutional Entitlement Offer will be used to partially fund the acquisition of the additional equity interest in APRR.

The latest developments have led MQA uplift its FY18 distribution guidance by 4.4% from 22.5 cents per security (cps) to 23.5 cps and the revised FY18 distribution guidance represents a 17.5% increase on MQA’s FY17 distribution. Given the increasing traffic levels with continuous focus on value generating portfolio, we maintain a “Hold” recommendation at the current price of $ 5.58

Transurban Group

TCL Details

Benchmark Issuance in the Eurobond Market:Transurban Group (ASX: TCL) has announced that Transurban Finance Company Pty Limited (the Transurban Group’s financing vehicle) has priced €500 million of senior secured 10.5-year notes under its Euro Medium Term Note Programme. The Notes were priced on 6 September 2017 and settlement occurred on 13 September 2017. All proceeds will be swapped into Australian dollars at a fixed interest rate and will be used to repay upcoming debt maturities, assist with funding ITS development pipeline and for general corporate purposes. The Notes will rank equally with Transurban’s existing senior secured debt facilities and will mature in March 2028.

TCL has increased its distribution guidance by 8.7% yoy for FY18 to 56.0 cps over FY17 distribution at the back of FY17 result entailing reported NPAT of $239m and revenue from ordinary activities growth of about 24%. The stock has otherwise declined 7.5% in the past three months while it is up over 10.8% in the past one year (as at September 18, 2017). The group will conduct its annual general meeting on October 12, 2017. Given the increasing momentum on infrastructure spending and group’s efforts, we give a “Buy” on the stock at the current price of $ 11.99

Disclaimer
 
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated pages are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.