The European Commission has just decided to extend its financial support for the first time to an investment fund dedicated to European transport infrastructure, the Galaxy Fund.
This decision results from a meeting held today, at the invitation of Francis Mayer, Chairman and CEO of Caisse des Dépôts, between, on the one hand, Philippe de Fontaine Vive, Vice-President of the European Investment Bank (EIB), and the representatives of the European Commission, and, on the other, the Management Board of Galaxy and representatives of its shareholders - Caisse des Dépôts, the Sanpaolo IMI Group (Italy) and KfW (Germany).
The European Commission has allocated EUR 25 million, under the management of the EIB, which will be deployed in accordance with a strategy of targeted co-investment with Galaxy, achieving an estimated gearing of 2.5.
An initial EUR 10 million operation has just been launched jointly by the EIB and Galaxy involving a motorway project meeting TENs (Trans-European Networks) criteria. A number of other projects are also being examined.
Galaxy operates in four transport infrastructure sectors: ports; airports; rail projects; and road, bridge and tunnel projects. It is therefore the sole private European player specialising exclusively in equity investment in transport infrastructure projects. Galaxy operates in tandem with the leading financial sponsors of European projects by offering additional gearing to that traditionally provided by banks. It thus participates in both new (greenfield) operations and on the secondary (brownfield) market. Galaxy's involvement thus generates fresh liquidity in this market, which will be reinvested both by sponsors and project companies in developing new infrastructure.
Galaxy has resources currently amounting to EUR 250 million, which it plans to invest by 2008. It is a long-term investor, aiming at a 15% return on its equity holdings. Its investment portfolio is expected to reach between EUR 75 and 100 million by the end of 2004.
Galaxy intends to embrace several new European shareholders by the end of the year, particularly major players in the new EU Member Countries, underlining its shareholders' and partners' desire to build an innovative European model for financing transport infrastructure within the EU.