JSE-listed Group Five has entered into a strategic joint venture (JV) alliance that will see Aberdeen Infrastructure Funds (AIF) acquire a 49.99% stake in Group Five’s European investment and concession assets within the Intertoll Europe underlying public–private-partnership (PPP) project’s investment portfolio for €43-million or R633.2-million.

The sale and purchase agreement and shareholders' agreement will leave Group Five with a 50.01% holding in the newly established Intertoll Capital Partners company that will now house the PPP’s 15% holding in Gdansk Transport Company, a 10% holding in Mecsek autopalya koncesszios zrt and a 12.67% holding in M6 Duna autopalya koncesszios zrt.

“The transaction creates a strategic alliance with AIF, which will coinvest with the company in future projects that provide access to capital, improving Group Five’s ability to participate in the development, investment, operations and maintenance of global concession assets,” Group Five explained in a statement.

The new JV is also eyeing further equity investments in similar concession assets across select markets, with the transaction proceeds retained offshore by Group Five to coinvest in new projects, alongside Aberdeen through the JV.

The deal is also expected to enhance Intertoll Europe’s prospects to secure new projects and allow the PPP to retain its entire operations and maintenance (O&M) capability and current contract portfolio.

“The parties have further agreed to a minimum five-year lock-in period in terms of the transaction agreements. The JV will endeavour to secure any O&M roles corresponding to such new investment assets for Group Five, thereby delivering on the group’s strategy of growing its O&M order book and annuity income,” Group Five said in an update to shareholders.

The transaction with AIF, which is a wholly-owned subsidiary of Aberdeen Asset Management, is expected to be concluded by March and remains subject to conditions precedent.

These include European Union, the Hungarian State and the Minister of Infrastructure for Poland approval, as well as the green light from the Financial Surveillance Department of the South African Reserve Bank, besides others.