The £998m BBGI Global Infrastructure trust is sitting on a hefty 26.3% premium, which the co-CEOs of the business said is a “luxury issue”, but analysts believe this makes the trust slightly more unattractive than its peers.
In August, Investec downgraded BBGI from a ‘hold' to a ‘sell' recommendation and said while it likes "the strong fundamentals" the premium means the implied steady-state return, or the portfolio discount rate less ongoing charges adjusted for the current premium, is just 3%. Given this valuation gap and "lower prospective returns" compared to its peers, it was no longer the firm's top choice. However, Frank Schramm, co-CEO of BBGI, said the premium strengthened during Covid and this showed the difference between the trust and its competitors, International Public Partnerships and HI...
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