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    Attero owns two energy from waste (‘EfW’) plants, two sorting and pre-treatment facilities, six anaerobic digestion facilities, seven composting facilities and 10 landfills. The company processes waste from a diverse mix of domestic municipalities, commercial and industrial customers, as well as a number  of UK and Irish exporters.

    Attero has good revenue visibility due to its long-term contracts with customers. It is well positioned within the Dutch market with two of the largest and most efficient EfW plants in the country, strategically positioned with good port, road and rail access for both import and domestic waste supply. In addition, Attero is strongly positioned to benefit from favourable underlying trends in the European waste market, driven by EU directives targeting more recycling.

    Investment rationale

    Attractive opportunity in a new sector for the Company,  with favourable long-term dynamics

    Attero operates two of the largest and best located waste treatment facilities in Western Europe, resulting in high efficiency and a low marginal cost

    The European Union requires member states to reduce landfill use, increasing the volume of waste requiring incineration

    Good revenue visibility from long-term waste supply contracts with municipalities, industrial customers, and waste exporters

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    Headquartered in Esbjerg, Denmark, ESVAGT is a leading provider of emergency rescue and response vessels (“ERRV”) and related services to the offshore energy industry in and around the North Sea and the Barents Sea. The company is also the market leader in the fast growing segment of service operation vessels (“SOV”) for the offshore wind industry. ESVAGT has been operating since 1981, employs c.900 people and owns a fleet of c.40 vessels. 

    Its ERRV services mainly involve the rescue and recovery of personnel, but also include the dispersion and recovery of oil spills, crew transfers and towing. ESVAGT is the leading provider of ERRV services in Denmark and Norway, with market shares of approximately 100% and 50%, respectively, as well as an established and growing presence in the UK. The majority of ESVAGT’s ERRV revenues are associated with North Sea oil and gas production support, with the remainder generated by supporting exploration activity.

    ESVAGT is also the pioneer and market leader in the provision of SOVs to offshore wind farms, with four bespoke vessels in operation and a further two under construction. SOVs are purpose-built, high performance vessels, providing efficient transport of maintenance technicians to wind turbines and other offshore wind equipment, under long term contracts. The offshore wind market, and hence demand for SOVs, is expected to grow strongly over the coming years, creating significant opportunities for the company.


    Developments in the year

    The market conditions in which ESVAGT operates are gradually improving. Increasing oil prices combined with improved emergency rescue and response vessel market supply dynamics are leading to increasing contract rates for ESVAGT’s tonnage. Jakob Thomasen became chairman of ESVAGT in May 2018. Kristian Jakobsen (previous COO) was appointed as interim CEO in December 2017. Lars Bjørn Olsen is interim CFO since March 2018.

    Offshore wind business

    ESVAGT has maintained its position as a service operations vessel market leader. In August 2017, it announced a new contract with MHI Vestas. The pipeline of new opportunities remains healthy in this high growth market.


    In December 2017, ESVAGT completed a €376 million refinancing. As part of the refinancing, the Company invested DKK 175 million further equity (c.£21 million) into ESVAGT.

    This refinancing replaces the debt taken on at acquisition and provides funding for further growth in ESVAGT’s offshore wind service business.

    Investment rationale

    3i Infrastructure acquired ESVAGT from AP Møller-Maersk and other minority shareholders in September 2015, in a consortium with AMP Capital.

    ESVAGT has strong infrastructure characteristics and operates in an attractive market:

    • It is a market leader in Denmark and Norway and has a small but growing presence in the UK offshore oil and gas market and in the expanding North Sea offshore wind sector.
    • It is an asset intensive business, with a modern state-of-the-art fleet of purpose-built vessels.
    • A high proportion of its revenues is contracted over the medium term with a diverse customer base featuring limited customer concentration, underpinning stable and predictable cash flows.
    • It provides an essential service for the offshore energy industry in light of regulatory health and safety requirements, which constitutes a small component of the overall production cost, resulting in lower price sensitivity;
    • It operates in a market with high barriers to entry, as customers require bespoke vessels, manned by experienced crews with a strong safety track record. The harsh weather conditions and language barriers also inhibit new market entrants based outside the region; and
    • With its leading market position, strong safety track record and state-of-the-art fleet, ESVAGT is optimally positioned to exploit growth opportunities in the UK and potentially further afield, as well as in the offshore wind energy market.
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    Infinis is the largest generator of electricity from landfill gas (“LFG”) in the UK, with a portfolio of 121 landfill sites and total installed capacity of over 300MW.

    Alkane Energy acquisition

    In March 2018, the Company announced its intention to increase its investment in Infinis by £125 million to fund Infinis’s acquisition of Alkane Energy (‘Alkane’), an independent power generator from both coal mine methane (‘CMM’) and reserve power (‘Peaking’) operations and the largest generator of electricity from CMM in the UK.

    As at December 2017, Alkane had 160MW of installed generating capacity operating from 32 sites across the UK.

    The merger of Alkane with Infinis will create a business with significant scale, offer operational improvement opportunities and the potential to further elevate Alkane’s generation performance and growth potential.

    Developments in the year

    The business has performed well operationally and financially. Infinis was a strong contributor to the Company’s income in the year, as expected in our investment case.

    In August 2017, Infinis appointed Tony Cocker as Chairman of the Board and Scott Longhurst as nonexecutive director and chairman of the audit committee.

    A new development team was established to pursue opportunities to exploit the business’s spare engine and grid connection capacity. 35MW of peaking power generation capacity is now under development, funded by a £12 million further equity injection from the Company  in November 2017.

    In the course of 2017, Ofgem confirmed its intention to cut the value of a significant embedded benefit, known as ‘Triads’, sooner than had been anticipated. The impact of this change was factored into the valuation of the Company’s holding in Infinis.

    Investment rationale

    The investment in Infinis is foremost a yield play. Its front-ended cashflows balance other recent investments by the Company in more growth-oriented businesses. Revenues are underpinned by the inflation-linked UK Renewables Obligation Certificate (“ROC”) regime until 2027. Infinis could also become a platform to make new investments in activities such as distributed power generation from other gas sources, distributed energy storage by exploiting the business’s spare engine and grid connection capacity, and additional landfill gas sites.

    Infinis and its market

    Infinis is the largest generator of electricity from LFG in the UK, with a portfolio of 121 landfill sites and total installed capacity of over 300MW. LFG is produced by decomposing organic matter in landfill sites. If released into the atmosphere unchecked, LFG contributes to pollution and is a potent greenhouse gas. By extracting LFG from landfill sites, Infinis fulfils an essential role in helping landfill operators meet their environmental compliance obligations. By using the collected LFG to generate electricity, Infinis supplies distribution networks with a consistent source of baseload power.

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    Singapore, Netherlands, Belgium, Malta

    Transport & logistics


    Oystercatcher is the holding company through which the Company holds 45% interests in five subsidiaries of Oiltanking, located in Belgium, Malta, the Netherlands and Singapore.

    These businesses provide over five million cubic metres of oil, petroleum and other oil-related storage facilities and associated services to a broad range of clients, including private and state oil companies, refiners, petrochemical companies and traders.

    Oiltanking is one of the world’s leading independent storage partners for oils, chemicals and gases, operating 73 terminals in 22 countries with a total storage capacity of 19 million cubic metres.

    Follow-on investments

    We have been progressing a number of follow-on investment opportunities with the terminal companies.

    On 2 May 2017, Oiltanking Ghent acquired 100% of Belgotank NV, a company which owns 82,000 cubic metres of tank capacity located on the Oiltanking Ghent site. These provide a mix of small tanks which are complementary to the business’s existing tank portfolio. On 25 September 2017, Oystercatcher made a follow-on equity investment of €2.4 million  into Oiltanking Ghent to part fund that acquisition. 

    Developments in the year

    The five terminals all performed well operationally and financially during the year. Each terminal enjoys a strong position in its market and benefits from Oiltanking’s reputation for excellent customer service levels. Capacity across the portfolio remains substantially let.

    The introduction of stricter standards for sulphur content in fuel oil used by ships from 2020 is impacting parts of the storage sector. It has led to a deterioration in fuel oil trading margins and reduced traders’ appetite to store this product. This has caused a sudden drop in market-wide fuel oil storage rates and has resulted in some storage capacity that was being used for fuel oil to become available in the market. At the same time many product markets are in backwardation, with forward prices below current levels.

    In Singapore, the terminal is a leading gasoline storage and blending facility. Continuing strong growth in demand for gasoline in  the wider region underpins the positive outlook for the terminal in the long term.

    However, a small part of its business has been impacted by the marketwide drop in fuel oil storage rates.

    In Amsterdam and Ghent, we have seen some softening of demand for gasoil storage. Gasoil storage is only a small part of the activities at the European terminals, with activities being dominated by gasoline storage and blending, and also including jet fuel and chemicals storage.

    Investment rationale

    The investment in the Amsterdam, Malta and Singapore terminals was completed in August 2007, while the investment in the Ghent (Belgium) and Terneuzen (Netherlands) terminals was completed in June 2015.

    The key elements of the investment case for the terminals are:

    • There is strong projected demand for oil and oil-related products;
    • Storage capacity remains scarce and is a key component of the oil and oil product supply chain, resulting in high occupancy;
    • The businesses provide essential services and the terminals benefit from facilities and operational capabilities that make them attractive to existing and potential clients;
    • The Singapore and Amsterdam-Rotterdam-Antwerp region terminals are defensively located in key trading hubs and continue to benefit from high utilisation levels;
    • Contracts are let on a use-or-pay basis with fixed terms of up to 10 years, often with tariffs linked to local inflation rates, resulting in reliable cash flows; and

    The transactions allowed 3i Infrastructure to partner with a leading player in the oil storage market, with a strong operational reputation.

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    Transport & logistics


    Headquartered in Brussels, Belgium, TCR is Europe’s largest independent asset manager of airport ground support equipment (“GSE”) and operates at over 100 airports.

    Since inception, TCR has defined the market for leased GSE, providing high quality assets and a full service leasing, maintenance and fleet management offering to its clients, which are predominantly independent ground handling companies, airlines and airports. This enables GSE operators to concentrate on their core business of ground handling. The GSE that TCR provides is critical infrastructure, without which some of Europe’s busiest airports could not operate.

    Developments in the year

    TCR performed well during the year. Contract renewal levels in its core European markets remain very high, demonstrating the defensive nature of the cash flows and TCR’s strong position in a growing market.

    In the year, TCR continued to expand its footprint in Europe, winning new contracts in several countries and adding new customers and asset classes to its offering. It has started operating the first passenger equipment pooling system in the UK at Luton Airport and is preferred bidder for another pooling contract at Gatwick Airport.

    Outside Europe, TCR strengthened its presence in Malaysia through additional contract wins with Malaysian Airlines. In Australia, it acquired Emerge Engineering & Maintenance, the leading local repair and maintenance business with workshops at six major airports and it is now competing for new leasing contracts.

    To further aid TCR’s strategic planning and to bring greater understanding of airports and airlines to the board, Declan Collier, the former CEO of London City Airport, was appointed as a non-executive director.

    Investment rationale

    TCR fits with the Company’s strategy of investing in companies with good asset backing, strong market positions and barriers to entry, yet with operational levers to achieve attractive returns for shareholders through active asset management:

    • GSE is a scarce resource that is critical to the functioning of an airport; through first mover advantage, TCR has benefited from securing the largest independent GSE fleet in Europe. TCR has access to maintenance workshops in prime locations at airports, many of which are located airside. This means that a high quality maintenance and asset management service can be provided, resulting in high availability of TCR’s fleet.
    • TCR is able to offer full-service rentals on a pan-European basis. This creates competitive advantages against competitors, which tend to offer either dry leases or only repair and maintenance services. TCR’s network means it can offer pan-European solutions at multiple locations, matching the footprints of its customers.
    • Outsourcing ownership of GSE equipment makes economic sense for independent ground handlers, as it allows them to manage the mismatch between short-term handling contracts and the typically 10-15 year useful life of equipment.
    • TCR’s rental contracts are aligned with the ground handlers’ contracts with the airlines and are typically 3-5 years in duration. TCR has experienced a high level of contract renewal.
    • The business has a diversified portfolio and is present at over 100 airports across 12 countries with a diverse contract and customer base meaning the revenues of the business are not materially reliant on a single client or geography. 
    • The investment will provide exposure to the long-term growth in the aviation market, which is fundamentally GDP driven, yet it is expected to be insulated from short-term shocks to demand due to its exposure to aircraft movements rather than passenger numbers.
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    Valorem is a leading independent renewable energy development and operating company. It is one of the largest onshore wind developers in France, having developed over 480MW of capacity over the last 10 years.

    The French power market is experiencing a major transition as it looks to reduce its reliance on nuclear generation and to increase generation from renewable sources of energy such as wind and solar. The energy transition has been continuously supported by the French governments over the past decade. With in-house capabilities across the entire project cycle and a strong local footprint, Valorem is well positioned to benefit from this shift in energy mix.

    Developments in the year

    Since acquisition in September 2016, Valorem has grown its existing onshore wind asset base from 142MW in operation to 216MW at the end of the period. In December 2017, Valorem closed the refinancing of the majority of its operational  wind portfolio, with a c.€180 million long-term non-recourse facility.

    The wind pipeline has also developed in line with expectations, with 24MW currently in construction and 700MW of advanced pipeline (fully permitted, approved but not yet clear of challenge, or with permit under instruction or preparation).

    During the year, Valorem has closed its first 36MW of photovoltaic (‘PV’) projects, and secured feed-in tariffs for an additional 88MW in the 2017 tariff auctions with an advanced pipeline of 250MW.

    Regulatory and political environment

    Renewables benefit from strong support from the French Government, which has an objective of a 32% renewables contribution by 2032 coupled with a carbonneutral electricity mix by 2040. In line with the need to triple the current installed PV capacity by 2023, in December 2017 the Government announced an increase of future PV auctions from 1.45GW to 2.45GW per annum over the next three years.

    Investment rationale

    This investment diversifies the Company’s portfolio with exposure to a growing renewables business in one of the most attractive European markets, and access to recurring, inflation-linked cash flows underpinned by a robust regulatory regime.

    Led by its experienced management team, Valorem is a best-in-class developer, being the fourth largest French wind developer and the largest independent one. It has a significant pipeline of projects at an advanced stage of development that it expects to convert into operating assets, with further projects at earlier stages to bring through the development process.

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    Wireless Infrastructure Group


    Wireless Infrastructure Group

    WIG is the UK's second largest independent tower company and the largest to focus solely on telecom towers. It operates c. 2,000 towers and other wireless infrastructure assets, representing 7% of the UK market.

    WIG is independent of any network operator and invests in shareable infrastructure that is made available to all networks.

    Follow-on investment

    During the year, the Company invested a further £190 million in WIG to acquire co-shareholder Barings’ majority stake and a portion of the management’s holding. This brings the Company’s total ownership in WIG to 93.1%, with management retaining the balance of equity. 

    Developments in the year

    WIG is performing in line with expectations, driven by a stable core business that is underpinned by long term, inflation linked contracts.

    During 2017, WIG supported its customers across existing and new infrastructure as they successfully delivered on their coverage targets.

    WIG has a growing pipeline of opportunities to invest in fibre based neutral-host wireless infrastructure, such as distributed antenna systems and small cells, which can provide multi-operator coverage in densely populated areas such as shopping centres, office blocks and stadiums.

    In Aberdeen, WIG deployed fibre based small cell infrastructure in partnership with Telefonica to create a 5G-ready network. WIG is also part of a consortium that has been awarded government funding to develop the UK’s largest real-world autonomous vehicle test bed in the West Midlands.


    The market outlook is favourable for tower companies as they support network customers in their projects to expand coverage in rural areas and densify networks and urban and suburban areas. Policy makers and mobile operators are becoming increasingly aware of the benefits of independently operated communications infrastructure and the market share of the independent tower sector continues to rise across Europe. The independent tower sector is also set to play a major role in supporting the deployment of 5G and the additional infrastructure this will require.

    Investment rationale

    In June 2016 3i Infrastructure acquired a 36% economic interest in WIG investing approximately £75 million and joining existing majority shareholder Barings Alternative Investments (formerly known as Wood Creek Capital Management) and the management team as shareholders.

    In January 2018, 3i Infrastructure plc completed its £186m further investment in WIG and acquired the stake owned by Barings LLC’s client accounts (“Barings), increasing its ownership to 91% of WIG’s equity, with the balance held by management.

    This investment diversifies the Company’s portfolio with exposure to a growing communications infrastructure business. Communication towers are critical pieces of infrastructure that are largely agnostic to technological change. The cash flows generated by the business are inflation-linked and are underpinned by long-term contracts. With its scalable platform and track record of building new infrastructure and making accretive acquisitions, WIG is well placed to target further growth in the UK and across Europe.

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