infrastructure Stewardship
Physical assets do not generate value by themselves. The decisions made about them do.
Infrastructure Stewardship Due Diligence
Stewardship Improvement Program
Advising Infrastructure Investors on Physical Asset Management and Regulatory EconomicsÂ
Hartley McMaster is an advisory firm serving infrastructure investors, owners and lenders, with a focus on stewardship due diligence and post-close value creation. Our practitioners are senior asset management directors and regulatory economists who bring the discipline of regulated utilities to infrastructure transactions, from the price to the hold to the exit.
Infrastructure underinvestment accrues before it shows
An operator can hold service and earnings steady for years while spending less than its asset base needs. The shortfall does not disappear. It accrues in the assets as a capital obligation the accounts do not carry and the price does not deduct.
01
The accrued capital obligation is not reflected in the accounts, so it is not in the vendor's model or the buyer's. The price can assume assets are in better condition than the ones being bought.
The Price
02
Renewal deferred by the seller can fall due during the hold, paid from the new owner's cash flow. The shift from planned to reactive maintenance that comes with deferral may already be under way, and already showing as rising operating cost.
The Hold
The Exit
Renewal not done in the hold remains in the asset base at exit, where the next buyer's adviser reads the same register. What it finds comes off the price. An owner that has renewed on plan can evidence it from the same records.
03
Services
Infrastructure Stewardship Due Diligence
An assessment of how the asset base has been stewarded by its owner, and what the investor inherits.
Stewardship Value Creation
Improvement plan and implementation to align the target's strategic asset management capabilities with the investment thesis.
The value of an infrastructure asset is set less by what the assets are than by how the owner manages them: what gets renewed, when, and on what evidence. Those decisions determine the capex over a hold, the maintenance cost, and the price the next buyer pays. Most investors see the assets and not the decisions. We examine the decisions, before a deal and after it.
Regulatory economics and engagement
Economic case and regulatory strategy to secure the allowances, price controls and approvals the investment thesis depends on.
Asset, risk and performance analytics
Evidence on the condition, risk and cost of the asset base to support investment decisions and the case made for them to boards, lenders and regulators.
Decision support and investment planning
Investment planning and prioritisation to deliver the required performance from the asset base for the least capital and risk.
Why Hartley McMaster
Applied mathematics since 1991
Thirty-five years of operational research for governments and operators in aviation, transport, utilities and telecoms.​
Regulatory experience
Regulatory economists who helped establish the regulator and developed the price control frameworks for utilities.
Asset management leadership
Practitioners who have held executive-level asset management roles at regulated network operators.​
25+ Regulated utility clients
Renewal cases, capex reviews and asset management assessments for regulated utilities.