Background
Babcock & Brown commenced its involvement in the infrastructure sector in the 1980s as an advisor and arranger of project financings. Operations began in the US and were subsequently expanded into Europe. By the mid 1990s, Babcock & Brown was a financial advisory market leader to independent power producers in both the US and Europe.
In 1996, Babcock & Brown began to focus on taking principal investment positions in projects developed under the UK Government's Private Finance Initiative (PFI or PPP) and at the time of the IPO developed assets in the sector with a gross development value of 418 million.
In 1997, the Infrastructure and Project Finance Division expanded into the Australian infrastructure market through the acquisition of Australian Industry Development Corporation (AIDC). AIDC was a Commonwealth Government-owned investment bank with a significant presence in the Australian infrastructure and project finance market. Babcock & Brown on-sold or liquidated certain businesses of AIDC, principally the non-infrastructure-related businesses, retaining a significant and profitable infrastructure investment portfolio and pipeline. This business formed the basis of the current Australian Infrastructure business.
Babcock & Brown's Australian business was further strengthened through the establishment of Babcock & Brown Infrastructure (formerly known as Prime Infrastructure), an ASX listed diversified infrastructure fund. Since listing on the Australian Stock Exchange (as Prime Infrastructure) in 2002, Babcock & Brown Infrastructure has grown and further diversified its portfolio both geographically and in terms of asset class. Prime Infrastructure was originally established with the Dalrymple Bay Coal Terminal (DBCT) as its foundation asset.
The Asian business was established in 2002. Babcock & Brown believes that there are significant opportunities in a number of Asian markets as private infrastructure development is further encouraged in those regions.