Brazilian highway concessionaire Triunfo Participações e Investimentos (TPI) (Bovespa: TPIS3) will charge 55% less for tolls on the Ayrton Senna-Carvalho Pinto highway than the current rate, but traffic volume is expected to continue increasing during the 30-year concession, TPI CEO Carlo Alberto Bottarelli told reporters in a conference call.
A 15-day TPI test found that the highway stretch was handling 30% more traffic in February 2008 compared to February 2005 and Bottarelli expects this to rise even more throughout the concession period.
The CEO estimates 11% less revenue from tolls but said that TPI is not linked to the current toll price and that investors should evaluate the project in the long term.
The firm will invest a total of 1.26bn reais (US$590mn) in the highway with a 594mn-real canon to be paid within 18 months and 20% of this due when the contract is signed. The remaining 668mn reais will be invested in improvements during the concession period.
São Paulo state bank Nossa Caixa will finance 119mn reais, while Banco Votorantim will lend another 200mn reais. National development bank BNDES will provide long-term financing of 250mn reais.
To cover the full cost of the initial investment, TPI will continue negotiations with other banks - such as BNDES private equity branch BNDESpar and IDB - after signing contracts and starting operations.
Just in its road projects, TPI estimates an annual internal rate of return (IRR) of about 11%, according to Bottarelli. He added that tollroad operator Concepa, fully owned by TPI as of October 6 this year, has an IRR of 18%. However, Bottarelli said the firm considers overall company growth, not just IRR. TPI also has operations in the port and energy sectors.
On October 29 TPI won the bidding for the concession of the 142km Ayrton Senna-Carvalho Pinto stretch in the eastern metropolitan region of São Paulo city.
The consortium proposed a toll rate of 0.0485 reais/km, 54.9% less than the ceiling stipulated by state government in the bidding rules.
No comments:
Post a Comment