Macquarie’s European growth continues

15 November 2005

Following five years of sustained growth, the European operations of the Macquarie Bank Group have again experienced strong performance in the six months to 30 September, 2005. 

Macquarie Bank Limited’s European income has increased to €275 million ($A434 million) in the half year to 30 September, up 206 per cent from the same period last year.  Macquarie’s international (non-Australian) income was more than double that of the prior corresponding period, and represented 46 per cent of total income in the six months to 30 September.  European income now represents 45 per cent of international revenue.

Macquarie’s early successes in Europe laid a strong foundation from which it continues to build.  European assets under management have grown from almost nothing five years ago to a portfolio of €11.6 billion ($A18.3 billion) at 30 September.

Head of Macquarie Europe, Jim Craig, said the recent growth for Macquarie in Europe is the result of building upon early success and a growing reputation for sound judgement, disciplined selection of quality assets and active asset management.

“From our first European activities in equities and project finance we have built new businesses and extended the franchise of other Macquarie businesses,” Mr Craig said.

The Macquarie Bank Group now manages more than 20** European assets extending from toll-roads and airports to directories and office parks, consistent with its model of investing in businesses with reliable cash flows, privileged positions and strong investment fundamentals.

“We can now point to a track-record of sound judgement and responsible and profitable asset management over the long-term.  This is attractive to investors, government partners, and the communities the assets serve,” said Mr Craig.

Macquarie has also established strong relationships with European investors.  The Macquarie European Infrastructure Fund closed in June 2005 with €1.5 billion in commitments from long-term investors, including some of Europe’s leading pension funds.

“Investors are attracted to the Macquarie model in which our industry experts are at the centre of sourcing, winning and managing the assets,” said Mr Craig.  “We take a disciplined approach to selecting and bidding for assets, then manage the investment with a view to sustainable, long-term success.”

Highlights for Europe and the Middle East – six months to 30 September 2005:

• Completion of the transition of Wales & West Utilities
• Macquarie European Infrastructure Fund achieved final close with investor commitments of €1.5 billion. The Fund also acquired the ferry service to the Isle of Wight – Wightlink and reached agreement to acquire 49 per cent of NRE* – the Netherlands gas and electricity distribution network
• Macquarie Bank property joint venture with office park developer Akeler commenced with acquisitions of Reading International Business Park and Central Quay, Glasgow; total value of £150 million (85 per cent acquired by Macquarie)
• Acquisitions by Macquarie Capital Alliance Group of the YBR Group (now known as European Directories) and BBC Broadcast (now known as Red Bee Media)
• Dyno-Nobel –  $US1.7 billion acquisition by MBL-led consortium
• Macquarie Global Property Advisors –   $US1.3 billion capital raised for second real estate private equity fund
• Macquarie Mortgages Italy – licensed mortgage operations in Milan and Rome
• Treasury and Commodities and Investment Banking joint ventures with Abu Dhabi Commercial Bank
• Acquisition of Tank Storage Business in Germany
• Established a UK gas trading business under a license to ship physical gas
• Macquarie Global Infrastructure Fund II agreed to acquire majority interest in DCT Gdansk - selected to design, construct and operate a new, deep-sea container port

Post balance date:

• Acquisition of the Isle of Man Steam Packet Company
• European Directories’ agreement to acquire TDC Directories*
• Macquarie Airports’ recommended tender offer for majority shareholding in Copenhagen Airports

“Macquarie’s European business is testament to our approach of focussing on areas where we can add special value,” says Mr Craig.  “From the London based business established in 1989 we have selectively moved into adjacent and complementary areas and now have a solid base of specialised European businesses which are focussed on adding value for clients and investors.”

Exchange rate at 30 September 2005 – 0.63443355             

* Subject to closing arrangements and approvals                  

** Includes assets subject to closing arrangements

For further information, please contact:

Karen Smith
Corporate Communications Manager
Macquarie Bank
Tel: (44) (0) 20 7065 2420