Bam recycles £20m of its equity invested in PPP projects

Bam, the European construction group based in Holland, is selling its equity stakes in four of its UK accommodation PPP schemes.

Bam’s initial spend ran to £20m. The current value of the equity investments has not been disclosed though typically a multiple of four has been offered in similar recent transactions.

A spokesman said: “The reason is that we wish to recycle funds. It brings us cash to invest in other projects.”

He declined to specify which four PPP schemes are affected.

The buyer is a joint venture between Bam and Dutch Infrastructure Fund (DIF). Bam will initially hold a majority share in the new company but the intention of both parties is to have equal shares by the end of 2009.

DIF is one of the first dedicated investment funds on the Continent targeting investments in risk-bearing capital in PPP projects. It is aiming for both newly tendered and existing projects in various countries in western Europe, including the UK, Ireland and Holland.

It entered the secondary PPP equity market in January when it struck a deal to acquire the equity in five PPP projects, buying the equity shares held in each of them by banking group ABN Amro.

All five schemes had reached financial close. The two of the five that are in the UK are Rochdale Schools PFI and Castle Hill Hospital PFI.

Bam has a total of 17 operational PPP/PFI projects spread across Germany, Ireland, Belgium, Holland and the UK.