Concludes syndication of the largest-ever project finance deal for a private toll road concession in the US
The Mandated Lead Arrangers -BBVA, Calyon, DEPFA and SCH- received commitments from 15 international banks
Cintra, one of the world´s leading transport infrastructure developers, and Macquarie Infrastructure Group successfully closed the syndication of a US$1.19 billion non-recourse senior debt facility for the acquisition of the Chicago Skyway Toll Road in the US. The Mandated Lead Arrangers -BBVA, Calyon, DEPFA and SCH- received commitments from 15 international banks with 100% oversubscription.
Chicago Skyway sets a precedent in the US market
This operation concludes syndication of the largest-ever project finance deal for a private toll road concession in the US. In the words of Juan Béjar, CEO of Cintra, “This success demonstrates the appetite and depth of the international bank market for well-structured US infrastructure assets. The acquisition of Chicago Skyway is a precedent-setting landmark for the US market”, he added, “and has raised considerable interest from other states in the US that are also looking at public-private partnership opportunities for infrastructure development”. According to the Lead Arrangers, “due to the unprecedented demand from the international banking market, both we and the invited sub-underwriting group have been substantially scaled back from our expected hold levels in the facility”.
The consortium headed by Cintra (55%), with Macquarie Infrastructure Group (45%), submitted a US$1.83 billion winning bid for the right to operate, maintain and collect toll revenue on the Skyway under a 99-year concession granted by the City of Chicago. Opened in 1959, the Chicago Skyway is a 7.8 mile (12.5 km) six-lane, access-controlled, elevated roadway, including a bridge over the Calumet River, which links I-90 from the Illinois-Indiana state line with the Dan Ryan Expressway (I-94) south of metropolitan Chicago.
Financing to acquire and improve the toll road
The senior debt facility is broken down into three tranches: the US$1,000mn Series A loan, which was fully drawn at closing on 24 January 2005, was used mainly to fund the acquisition of the Skyway from the City of Chicago; the US$110mn Series B loan is to be used to pay part of the accruing interest on the Series A, B and C loans; and the US$80mn Series C loan is to be used to fund ongoing capital improvements on the Skyway between 2005 and 2008, as required under the terms of the concession. The senior debt has a final maturity of 9 years and pays a margin of 1.25% p.a. from years 1 to 5; 1.50% p.a. in years 6 and 7; and 1.75% in years 8 and 9.
