Allianz Global Investors has welcomed the UK Government’s commitment, delivered as part of the Chancellor’s Autumn Statement, that it will introduce a new Withholding Tax exemption for private placements.
AllianzGI is aiming to invest upwards of GBP3 billion in UK infrastructure over the next three to five years.
Elizabeth Corley, CEO, says: “Allianz Global Investors aims to invest upwards of GBP3 billion in UK Infrastructure debt over the next three to five years, consistent with us being on track to invest around GBP600m in UK infrastructure debt by the end of 2014, the first full year of sterling investing activity by our pan-European infrastructure debt platform.”
Deborah Zurkow, CIO for Infrastructure Debt at Allianz Global Investors, says: “The Government’s decision is good news for everyone who is passionate about UK infrastructure, for those who are committed investors in the asset class and ultimately to everyone in the UK who uses infrastructure. Introducing a new Withholding Tax exemption for private placements will act as an important step in helping unlock further international investment into UK infrastructure, meaning more of the projects the country wants will get financed and be built.
“Simple, effective changes like this, that help reduce the complexity involved in transactions, are the most cost-effective way of creating an attractive, long-term infrastructure investment environment for the broadest possible base of investors. Compared to the stability and depth of its US counterpart, the European private placement market remains in its infancy, so will need continued careful nurturing to achieve its full potential.”
Allianz Global Investors launched a UK Infrastructure Debt Fund in June 2014. The fund, aimed at institutional investors, will invest in long-term, investment grade, core UK infrastructure assets, including roads, schools, hospitals, water and energy assets.
As well as providing institutional investors with the long-term stable cash flows they need to match their future payments needs, infrastructure debt also offers them the opportunity to invest in projects that support the UK’s economic competitiveness and quality of life.
Over the last twelve months, AllianzGI has invested nearly GBP2 billion on behalf of its clients into ten infrastructure debt transactions across eight European countries. In 2014, clients investing in infrastructure via AllianzGI’s platform have constituted the largest private sector investments in three key UK infrastructure projects, including the M8 in Scotland and the M1/A1 in Northern Ireland.
