Babcock & Brown Limited Update

Submitted by Craig Strzelecki on 7 May, 2007 - 19:22

Babcock & Brown Limited has a maintained Buy 2 broker call and a share price target of $33 from stockmarket analyst UBS. Babcock & Brown has been awarded its first US toll road deal: BNB preferred bidder of the Port of Miami Tunnel: A BNB consortium has been selected as preferred bidder to design, build, finance and operate the Port of Miami Tunnel project. The development is via a 35 year concession public-private partnership structure with an estimated value of US$822m. The project includes construction of two undersea tunnels, widening the Causeway bridge and connecting to the existing roadways. First US toll road win is strategically important: the analyst sees this as a very strategically important deal for Babcock & Brown Limited, although the financial impact is less significant. (1) BNB's first PPP transport project in the US (2) "Foot in the door" for future US road and transport deals (3) Utilised staff/teams recently acquired from ABN in Australia and Canada (4) Potential asset for an offshore BNB managed fund. Strong deal-flow may drive upgrades with the AGM (25 May): BNB has seen a very strong deal-flow through the start of 2007. This includes (1) Potential Alinta deal (2) partial sell down of Enersis assets (3) Potential European Fund closure (4) BBI acquisitions (5) GPT JV German selldown (6) Canadian PPP. Key drivers for Babcock & Brown Limited: (1) expanding capital base (2) highly leveraged to its Funds rollout (3) seed assets on its balance sheet (4) diversified revenue. Risks: (1) PE is volatile (2) significant interest rate & markets risks.

Babcock & Brown Limited is listed on the Australian Stock Exchange (ASX) under stock code BNB. You can view their investor website here. Babcock & Brown is involved in investment banking, structured finance advisory, arrangement and management businesses, principal investment and other wholesale financial services. BNB was listed on the ASX on 6 October, 2004. Phillip Green is the Managing Director of Babcock and Brown. Find out the meaning of the recommendations in this primer. More Babcock & Brown (BNB) shares recommendations and news. Browse for other stockbroker recommendations. Check your charts and good luck with your share trading!