– Macquarie Power & Infrastructure Income
Fund (TSX: MPT.UN; MPT.DB.A – “MPT” or the “Fund”) and Leisureworld Senior Care
Corporation (“Leisureworld”) today announced the closing of Leisureworld’s initial public
offering (“IPO”) of 19,020,000 common shares at a price of $10 per share, resulting in
gross proceeds of approximately $190 million.
Use of Proceeds
Leisureworld used the proceeds from the offering to pay offering-related expenses, including
underwriting commissions, of approximately $15 million, repay approximately $62 million of
Leisureworld’s debt, and to acquire approximately 95% of the ownership interests in
Leisureworld Senior Care LP and Leisureworld Senior Care GP Inc. (collectively, “LSCLP”)
from their current owner, Macquarie Long Term Care LP (“MLTCLP”). The balance of the
ownership interests in LSCLP were concurrently acquired by Leisureworld in consideration for
the issuance of a promissory note to MLTCLP. Prior to the sale to Leisureworld, MPT and
Macquarie International Infrastructure Fund Limited (“MIIFL”) indirectly owned approximately
45% and 55%, respectively, of the economic interest of MLTCLP.
The underwriters have also been granted an over-allotment option, exercisable in whole or in
part for a period of 30 days, to purchase up to an additional 958,649 common shares of
Leisureworld. Leisureworld will use the net proceeds from the exercise of the over-allotment
option to repay the promissory note issued to MLTCLP. In the event that the over-allotment
option is not exercised in full by the underwriters, MLTCLP will be issued a specified number of
common shares of Leisureworld based on the IPO price in satisfaction of Leisureworld’s
remaining obligations under the promissory note. Assuming the over-allotment option is
exercised in full, MPT expects to receive net proceeds from the sale of its indirect interest in
LSCLP of approximately $55 million.
Under the acquisition agreement between MLTCLP and Leisureworld, MLTCLP will be
required to retain approximately $12 million as a holdback amount, covering MLTCLP’s
indemnification obligations under the agreement, until March 31, 2011.
The offering was made through a syndicate of underwriters led by TD Securities Inc.,
Macquarie Capital Markets Canada Ltd.1 and RBC Capital Markets, and including BMO capital
Markets Inc., CIBC World Markets Inc., Scotia Capital Inc., HSBC Securities (Canada) Inc.,
Brookfield Financial Corp., and Genuity Capital Markets. Further information regarding the
offering is contained in Leisureworld’s final prospectus, which is available on SEDAR at
www.sedar.com.
Updated Guidance for 2010
The Fund’s distribution level of $0.055 per unit monthly, or $0.66 per unit on an annualized
basis, is currently expected to be sustainable through 2014. This distribution level is expected
to result in an average payout ratio of approximately 70 to 75% of distributable cash2 over a
five-year period based on the Fund’s current portfolio. As a result of the divestment of
Leisureworld, the Fund currently anticipates that the 2010 payout ratio will be slightly above
this range. The Fund currently anticipates that approximately 15% of the distributions paid to
Canadian investors in 2010 will be a return of capital, reflecting revised assumptions including the divestment of Leisureworld. The Fund previously expected that approximately 40% of
these distributions would be considered a return of capital.
Macquarie Power & Infrastructure Income Fund is not an authorised deposit taking institution for the purposes of the Banking
Act (Cth) 1959 and Macquarie Power & Infrastructure Income Fund’s obligations do not represent deposits or other liabilities
of Macquarie Bank Limited ABN 46 008 583 542 (MBL). MBL does not guarantee or otherwise provide assurance in respect of
the obligations of Macquarie Power & Infrastructure Income Fund
This press release does not constitute an offer to sell or a solicitation of an offer to buy any
securities of the Corporation in any jurisdiction in which such offer, solicitation of sale would be
unlawful. These securities have not been and will not be registered under the United States
Securities Act of 1933, as amended (the "U.S. Securities Act") or any U.S. state securities
laws and may not be offered or sold in the United States except in compliance with the
registration requirements of the U.S. Securities Act and applicable U.S. state securities laws or
pursuant to an exemption therefrom. Any public offering of the securities in the United States
may only be made by means of a prospectus containing detailed information about the
Corporation and its management as well as financial statements.
1 Macquarie Capital Markets Canada Ltd. is a wholly-owned subsidiary of Macquarie Group Limited and accordingly is a related party of
Macquarie Power Management Ltd., the administrator of the Fund.
2 Distributable cash is defined as cash flows from operating activities after removing changes in working capital. Distributable cash also
reflects the impacts of: cash taxes; releases from maintenance reserves; allocations to major maintenance and capital expenditure
reserves; and non-discretionary payments and receipts.
About the Fund
Macquarie Power & Infrastructure Income Fund invests in essential infrastructure assets in
with an emphasis on power infrastructure. MPT’s strategy is to acquire and actively manage a
diverse, high quality portfolio of infrastructure assets to improve their financial performance
and provide sustainable and growing distributions to unitholders. MPT’s portfolio currently
includes investments in gas cogeneration, wind, hydro and biomass power generation
facilities, representing approximately 350 MW of installed capacity. MPT is managed by a
wholly-owned subsidiary of Macquarie Group Limited. Please visit www.macquarie.com/mpt
for additional information.
Forward-looking Statements
Certain of the statements contained in this news release are forward-looking statements and are provided for the
purpose of presenting information about management's current expectations and plans relating to the future and
readers are cautioned that such statements may not be appropriate for other purposes. These statements use
forward-looking words, such as “anticipate”, “continue”, “could”, “expect”, “may”, “will”, “estimate”, “believe” or other
similar words and include, among other things, statements related to the size and use of proceeds of the IPO and
related over-allotment option granted to the underwriters, structuring and payment for the balance of the ownership
interests in LSCLP, funds to be received by MPT in connection with the IPO and MPT’s financial performance. These
statements are subject to significant known and unknown risks and uncertainties that may cause actual results or
events to differ materially from those expressed or implied by such statements and, accordingly, should not be read as
guarantees of future performance or results and will not necessarily be accurate indications of whether or not such
results will be achieved. The forward-looking statements in this news release are based on information currently
available and what the Fund currently believes are reasonable assumptions, including the material assumptions for
each of the Fund’s assets set out in the Fund’s 2009 Annual Report under the heading “Outlook” on page 42, as
updated in subsequently filed Quarterly Financial Reports of the Fund and other filings with the Canadian Securities
Administrators’ System for Electronic Document Analysis and Review (SEDAR) at www.sedar.com. Other material
factors or assumptions that were applied in formulating the forward-looking statements contained herein include the
assumption that the business and economic conditions affecting the Fund’s operations will continue substantially in
their current state, including, with respect to industry conditions, general levels of economic activity, regulations,
weather, taxes and interest rates and that there will be no unplanned material changes to the Fund’s facilities,
equipment and contractual arrangements.
Although the Fund believes that it has a reasonable basis for the expectations reflected in these forward-looking
statements, actual results may differ from those suggested by the forward-looking statements for various reasons,
including risks related to: operational performance; power purchase agreements; fuel costs and supply; contract
performance; default under credit agreements; land tenure and related rights; regulatory regime and permits; force
majeure; changes in federal tax rules for flow-through entities; other tax-related risks; variability of distributions;
geographical concentration and non-diversification; dependence on the manager and potential conflicts of interest;
insurance; environmental, health and safety regime; availability of financing; unitholder dilution; volatile market price
for units; international financial reporting standards; nature of units; and unitholder liability. The assumptions, risks and
uncertainties described above are not exhaustive and other events and risk factors could cause actual results to differ
materially from the results and events discussed in the forward-looking statements. These forward-looking statements
reflect current expectations of the Fund as at the date of this news release and speak only as at the date of this news
release. The Fund does not undertake any obligation to publicly update or revise any forward-looking statements
except as may be required by applicable law.