Ferrovial consortium completes financing of Highway 407 East Phase 2 in Canada for 642 million euro

As a result of a competitive procurement process, Ferrovial, via subsidiary Cintra Infraestructuras Internacional, in a 50:50 consortium with Holcim (Canada) Inc., has achieved commercial and financial close of the Highway 407 East Phase 2 concession in Toronto, Canada, with an estimated total investment of 880 million Canadian dollars, equivalent to around 642 million euro. The contract was signed after Infrastructure Ontario and Ontario's Ministry of Transportation selected the consortium as preferred proponent in late January. The 32-kilometre concession will run for 30 years from the date the first section of the project opens to traffic, expected in late 2017. The Highway 407 East Phase 2 project includes a 22-kilometre extension of Highway 407 Phase 1, with 2 lanes in each direction, from Harmony Road, in Oshawa, to where it connects with Highway 35/115, in Clarington. The project also includes a new 10-kilometre link to connect with Highway 401. The Highway 407 East Phase 2 project will be a toll road, like 407 East Phase 1, for which the Ontario government will set the tolls and collect the revenue, while the concession company will be paid on the basis of an availability formula for performing maintenance and lifecycle repair services. To cover costs, the consortium have issued two bonds: a short-term bond amounting to 264 million CAD, maturing at the end of construction, and a long-term bond amounting to 108 million, maturing in June 2047, and structured a Senior Revolving Construction facility worth 241 million CAD, maturing at the end of construction. Cintra, together with Holcim (Canada) Inc., will be responsible for project development, and Ferrovial Agroman and Dufferin Construction, a division of Holcim (Canada) Inc., will be responsible for the design and construction. Another consortium led by Cintra Infraestructuras was awarded the Highway 407 East Phase 1 contract, which is worth 1 billion Canadian dollars, also by competitive tender. Both phases will improve the region's traffic conditions, strengthen opportunities for economic development, boost employment and enhance the mobility of people and goods. Cintra is one of the world’s leading private sector developers of transportation infrastructure in terms of the number of projects and the volume of investment. It currently manages 2,232 kilometres of toll roads in 28 concessions in Canada, the US and Europe.