MOTO is the largest owner and operator of Motorway Service Area property in the UK, with a 2014 EBITDA of £91.8m.
EPIC was established in 2007 as an investment entity to make minority investments in various UK infrastructure projects, including MOTO, Thames Water and Arquiva. At the time of Greycoat’s investment in EPIC, its c. 17.5% stake in MOTO accounted for over 95% of EPIC’s asset base. Due to the size of its shareholding, EPIC benefitted from significant shareholder rights within the MOTO holding structure.
Greycoat, in joint venture with Cheyne Capital, acquired a c. 85% interest in EPIC at a price of 30 pence per share (£45.2m cost), via a combination of a share placement and purchase of shares from existing investors.
At the time of acquisition, MOTO had short term debt with a c. 10% weighted cost of debt. In Q2 2015 MOTO refinanced its existing facilities to deliver a c. 5.6% weighted cost of debt on the same leverage quantum. In the period from Q2 2014 to Q2 2015 MOTO’s EBITDA increased by over 10%.
In Q4 2015 EPIC joined the other shareholders in MOTO in selling on a whole business basis to the Universities Superannuation Scheme. The realised price resulted in cash proceeds to shareholders of 77.8p per EPIC share.