Lead Manager

SECTION 3
BUSINESS OVERVIEW
Financing
Babcock & Brown uses its structured finance expertise to segment the risks and returns from various components
of a transaction and endeavours to allocate them to the party that is best suited to hold or manage them. Babcock
& Brown’s ability to deliver efficient financing solutions is enhanced by:
• Longstanding relationships with a broad group of banks and other financial services companies across its
global platform
• Regular dealings with financial intermediaries such as investment banks, financial guarantors and ratings
agencies as well as its own participation in financial markets
• Experience in a wide range of financing techniques
• Strong track record which assists it in gaining the broader market’s acceptance of innovative financing
solutions
Investment packaging, syndication and management
Whilst Babcock & Brown does undertake some asset trading activities purely on its own account, the majority of
principal investments are made in conjunction with, or syndicated through investment vehicles.These investment
vehicles take a number of forms, including:
• Listed investment vehicles, such as Prime Infrastructure
• Unlisted retail funds, such as the Foundation Property Fund, a UK property fund that offers leveraged
investment into properties with secure cash flow
• Private equity syndicates
Babcock & Brown typically earns annuity-style management fees in addition to performance fees for its role in
managing the assets or investment vehicles.These fees are in addition to the investment returns Babcock &
Brown receives from its own investment in these vehicles.
Babcock & Brown’s investment track record has helped it to build relationships with a meaningful number of
high net worth private investors and institutions that participate on a repeat basis in Babcock & Brown
investments.
Associated opportunities
In association with its investment activities, Babcock & Brown seeks to increase its returns by providing advisory
services to the groups in which it invests and the investment vehicles it creates.
Track record
In aggregate, Babcock & Brown has generated an average pre-tax IRR on its capital in excess of 30% (net of
fees) since January 2000.
Future growth
The capital made available under the Offer will be used by Babcock & Brown to grow its investment-related
activities across its Business Groups and to grow its investment management business.
Babcock & Brown will also use the capital available from the Offer and the additional leverage this capital will
support, to facilitate making larger investments and/or extending holding periods of investments.The third party
syndication of the initial equity in the DBCT (see case study in the Infrastructure and Project Finance Section) is
an example of a transaction that Babcock & Brown may not have syndicated as early or to the same extent had it
had the capital at the time to fully fund this asset up to the point of listing Prime Infrastructure.
As it has done historically, Babcock & Brown intends to continue to develop various investment and funding
vehicles that will invest across a range of Babcock & Brown investments.
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