Infrastructure

Although the sector doesn't typically see significant deal volumes quarter-to-quarter, there have been a number of notable deals.

Recent activity includes the acquisition of George Best Belfast City Airport by 3i in 2020, the purchase of Fayair by Harrods Aviation in early 2023 and the buyout of John Laing Group by Equitix and KKR in June 2021. 

The sector faces challenging headwinds, resulting in our elevated stress rating in recent quarters. In particular, changes in the economic outlook have placed pressure on government spending across the board, which is a catalyst for infrastructure investment across both public and private spheres. The delaying and downgrading of High Speed 2 (HS2), and the pausing/cancellation of several road improvement projects, are likely to impact on the sector performance across the medium-term.

That said, investment in 'Net Zero' initiatives continues to expand. Investment in low-carbon activities totals 0.9% of GDP – above Italy, Japan and the US (though the latter is catching up quickly), but trailing the likes of France and Germany. We're likely to see increased focus on infrastructure investment that improves network resilience in the face of climate change and drives the move towards a low-carbon economy.