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Unlocking Value Through Asset Recycling

In: Advances in Infrastructure Finance

Author

Listed:
  • Raghu Dharmapuri Tirumala

    (University of Melbourne)

  • Piyush Tiwari

    (University of Melbourne)

Abstract

Raising of financing for infrastructure projects by unlocking the value of existing assets is a new method that has gained momentum world over. For the continued success of this method of financing, it is essential that the asset recycling is designed in such a manner that private sector shows interest to participate. Australia has been one of the leading countries to have initiated this method of raising finances. The asset included approach included attracting investments from pension funds, sovereign wealth funds (SWFs), and private investment funds in core infrastructure projects. The monetary value that the private sector perceives in such asset monetization transactions varies from region to region and is influenced by the prevailing conditions. The charm of the asset recycling is that this modality is perceived to be a potential fast track mechanism to bridge the infrastructure gap. The proponents of the asset recycling to be used as a mainstream option for financing new infrastructure assets have argued their case based on the benefits that are likely to accrue to the government, private sector, and the public. The cycle of asset recycling can repeat itself, with the assets developed through an earlier asset recycling initiative become cash flow steady and are then ripe for being hived off in a subsequent asset recycling scheme.

Suggested Citation

  • Raghu Dharmapuri Tirumala & Piyush Tiwari, 2023. "Unlocking Value Through Asset Recycling," Springer Books, in: Advances in Infrastructure Finance, chapter 0, pages 187-208, Springer.
  • Handle: RePEc:spr:sprchp:978-981-99-0440-2_8
    DOI: 10.1007/978-981-99-0440-2_8
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