John Laing Infrastructure Fund (JLIF.L) said on Monday it was in talks with a consortium of funds about a possible cash buyout offer that could value the company at 1.41 billion pounds ($1.9 billion).
JLIF, one of Britain’s biggest listed investors in public infrastructure projects, said the potential offer is worth 142.5 pence per share and includes the payment of a dividend of up to 3.57 pence per share to JLIF shareholders.
The offer represents a premium of nearly 21 percent to JLIF’s closing share price of 118.2 pence on Friday. The stock soared 19 percent to 140.4 pence in early trade in London.
JLIF’s board has indicated to the consortium that it will back the offer, the company said.
British infrastructure funds, which were a popular choice for investors after the financial crisis, are battling the threat of nationalization and windfall taxes from the government.
The high-profile collapse of outsourcing group Carillion (CLLN.L), which had partnerships with a number of these funds, added to fears that projects might be awarded to the public sector.
“We believe this offer would be an excellent result for shareholders following a difficult 12-month period for the shares,” Liberum analysts wrote in a note.
The consortium includes Dalmore Capital and Equitix Investment Management acting as managers on behalf of certain funds, JLIF said.
Under British takeover rules, the consortium now has until Aug. 13 to either announce a firm intention to make an offer or walk away from the table.
Shares of rivals HICL Infrastructure (HICL.L), International Public Partnerships (INPP.L) and BBGI (BBGIB.L) were all trading higher.