NGN Funding Public / private interplay - Henri PIGANEAU - CUBE Infrastructure Fund - NGN Funding Executive Seminar - DigiWorld Summit 2013
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NGN Funding Public / private interplay - Henri PIGANEAU - CUBE Infrastructure Fund - NGN Funding Executive Seminar - DigiWorld Summit 2013

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Henri Piganeau, Managing Partner, Cube Infrastructure

Henri Piganeau is Managing Partner at Cube Infrastructure, a €1.1 bn fund dedicated to majority investments in brownfield infrastructure companies across Europe; he is notably in charge of the development of the telecom platform since joining Cube in 2007.

Henri has over 26 years of infrastructure project management and investment experience in concession projects, including over 10 years in the Telecom industry at Vivendi, where he developed and managed numerous concession projects, particularly in Hungary, Morocco and Spain. He notably served as CEO in Budapest for three Vivendi’s subsidiaries representing 1,200 employees servicing more than 450,000 clients and in Madrid, as deputy CEO of Xfera (today renamed Yoigo), the 4th Mobile Telecom Operator.

Henri’s extensive infrastructure experience also includes a €2.7 billion project he lead as Deputy General Manager of Engineering & Architecture at Aéroports de Paris, several major concession projects (Millau Bridge, A41, A86 tunnel, etc.) as CEO at SETEC and prior to that as General Manager of the industrial division of Spie Batignolles Group, as well as the infrastructure program of the 1992 Winter Olympic Games in Albertville for the Ministry of Transportation and the County of Savoie.

Henri is a graduate of Ecole Polytechnique (X79) and of Ecole Nationale des Ponts et Chaussées (Corps) and has a M.Sc. from Berkeley, USA.

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    NGN Funding Public / private interplay - Henri PIGANEAU - CUBE Infrastructure Fund - NGN Funding Executive Seminar - DigiWorld Summit 2013 NGN Funding Public / private interplay - Henri PIGANEAU - CUBE Infrastructure Fund - NGN Funding Executive Seminar - DigiWorld Summit 2013 Presentation Transcript

    • Henri Piganeau NGN Funding Cube Infrastructure Fund Public / private interplay November, 20th 2013 « DigiWorld »
    • 1. Cube has 13 Investments in portfolio across 4 industrial platforms as of June 30, 2013 Transport Platform Energy Supply Platform Ferries & Bus Leading ferry and bus operator in Norway Idex Services 3 largest1) district heating and energy services group in France rd NeoElectra District heating and energy services specialist in France Railways & Bus 2nd largest3) private public transport operator in Germany Power Generation Platform Communication Infrastructure Platform Cogeneration, Biomass & Biogas Energy Independent power producer specialized in small to mid size cogeneration, biomass and biogas plants Wind Energy Wind producer in France (capacity of 276 MW2)) Hydro Energy Hydro power plants in Spain and r Portugal (capacity of 88 MW) Photovoltaic Energy Solar energy assets in Europe (installed capacity of 6 MW) Waste to Energy Leading position in the UK energy-for-waste industry 2 EUROPE Telecom Sub-marine Cable Sub-sea optical fiber telecom cables operator in Spain DEVELOPMENT Source: Xerfi (2011 results) Including 80MW of wind currently under construction, excluding the 11MW cogeneration and 4MW of PV 3) Source: NEIL analysis, based on Revenues 4) Source: NEIL analysis, based on # of concessions 1) 2) Fiber Optics Local Loops #14) French independent fibre optic networks’ concessions operator 5) Divestment foreseen in Q3 2013
    • 2. NGN1) roll-out in Europe   EC Digital Agenda objective is to having 50% of households with over 100 Mbps subscription by 2020 Actual progress rate stands at 2% 2% Source: Digital Agenda Scoreboard  Europe is lagging behind Asia and North America in terms of FttH take-up  Europe is largely heterogeneous with only a limited number of best performing countries in terms of effective access to high speed broadband technology Source: European Commission A blatant need for funding ICT infrastructure A blatant need for funding ICT infrastructure 3 1) NGN applies for symmetric bit stream superior to 100 Mbps
    • 3. Infrastructure Funds in Europe General overview Available funds  Specialized Private Equity Funds that concentrate on financing infrastructure companies  Typology Dry powder has been largely growing from 2003 on Current dry powder in EU: ca. € 25 billion1)  $ bn 35 30 25 20 15 10 5 0 31.8 31.7 22.6 15.9 1.7 6 19.7 17.9 24.1 20.7 7.9 déc.-03 déc.-04 déc.-05 déc.-06 déc.-07 déc.-08 déc.-09 déc.-10 déc.-11 déc.-12 sept.-13 Dry powder Europe  Telco sector attracted only 6% of investment in infrastructure in 2005-11 1) 35% 30% An untapped potential for Telco 25% 20% 15% 10% 5% 0% Oil & Gas Transport Power Renewable Energy Mining Social & Defense Telecom Waste & Water Despite its qualities (anti-cyclical nature, etc.), communication infrastructure might Despite its qualities (anti-cyclical nature, etc.), communication infrastructure might not always be perceived as infrastructure to infrastructure investors… not always be perceived as infrastructure to infrastructure investors… 4 1) 2) Source: Preqin, September 2013 Source: Ventura, March 2012
    • 3. Infrastructure Funds in Europe Where has their money gone to date? Fund Investment Date RIP 200x Set of common characteristics 2008 2009 2011 2011  Open Access Networks, i.e. underlying infrastructure is separated from services procurement  Mostly, enjoying a monopolistic or duopolistic position 2011 2012 2013  With a developed asset base  And for some, existing revenues (including cable that would migrate to FttH) 2013 Infrastructure funds strive to limit the commercial risk when investing in NGN assets Infrastructure funds strive to limit the commercial risk when investing in NGN assets 5
    • 3. Infrastructure Funds in Europe Attracting Infrastructure Funds: Addressing the risks Several risks are associated to Communication Infrastructure projects; main one is the commercial risk Mitigant Risk Cartography  monopolistic position Distribution Market adoption [2] [5] [6] Network competition [5] [6]  Commercial risk [5] Construction risk [2] Commitment from RSPs to use the network [1] [5] [6] Technological risk [1] Open Access Networks with a  [3] Long term contracts with RSPs or local authorities Regulatory risk [1]  [4] Availability or guarantee from local authorities  [5] Extinction of copper (copper removed once roll out is completed) Financing risk  [3] [4] [5] [6] [6] Migration from copper (ownershio of both copper and fiber network – extinction of copper afterwards) 6 payments
    • 3. Infrastructure Funds in Europe Attracting Infrastructure Funds: Addressing the risks The commitment of the RSPs, notably the incumbant, would be a key to an efficient financing scheme Features Structure Chart  RSPs (including incumbant) and neutral operators Commitment to use the Operation network contract (1-x%) a monopolistic position Infrastructure Funds  [2] Commitment from RSPs to use the network x%/ x>>50% Special Purpose Vehicule [1] Open Access Networks with Public authorities  [3] Long term contracts with RSPs or local authorities Guaranttees Banks / bond holders  [4] Availability payments guarantee from local authorities  Concession for the roll out of a fiber OpenAcceconcession ss Network - copper to be contributed (to the SPV, to the concesssion...). 7 or [5] Extinction of copper  [6] Migration from copper