Post by Bender on Aug 6, 2009 16:05:54 GMT -5
Indiana Toll Road officials deny sale reports
Bauer says transaction 'maybe close to probable.'
By ED RONCO Tribune Staff Writer
Reports that the private manager of the Indiana Toll Road might find the next off ramp and sell its leases to raise money are not correct, said a spokesman for the Australian group.
But House Speaker B. Patrick Bauer, D-South Bend, maintains that such a transaction is possible and "maybe close to probable," despite being blasted by Macquarie's investor relations arm.
An Australian and Spanish consortium paid $3.8 billion to Indiana in 2006 in exchange for a 75-year lease on the Indiana Toll Road.
News reports, including a Bloomberg story last week, have suggested that Macquarie infrastructure Group might sell its leases on the Indiana Toll Road and the Chicago Skyway.
Traffic on the 157-mile expressway was down 9.5 percent for Macquarie's 2009 fiscal year, which ended June 30.A July 8 statement said Macquarie is reviewing options to "enhance security holder value."
The economy has had a negative effect on the value of Macquarie's Toll Road portfolio.
And with the Indiana Toll Road, revenue has increased 2.9 percent for the fiscal year, but the Bloomberg story cites a 14 percent drop in the value of the Australian dollar against the U.S. dollar, which has reduced the value of Macquarie's investments.
Macquarie Infrastructure Group spokesman Alex Doughty said speculation the group will shed the Toll Road is "simply incorrect."
"MIG is not in the market pursuing a sales process for any of its U.S. assets, including the Indiana Toll Road," he wrote in an e-mail.The Sydney-based Macquarie Infrastructure Group owns a 25 percent stake in the lease. Macquarie Infrastructure Partners owns another 25 percent. The remaining half of the lease is held by a Spanish group called Centra.
Leigh Morris, deputy commissioner for Toll Road oversight for the Indiana Department of Transportation, said he thinks a sale of the lease is unlikely, but even if it were to occur, the state would have to approve it.
"I didn't have a thing to do with negotiating the lease, but the folks that did, did a masterful job of protecting the interests of the state of Indiana," Morris said.
He acknowledged reports that Macquarie has had difficulties, "but they've also indicated that they don't believe (a sale) is likely to happen," he said. "And they kind of resent some of the speculation that's going on."
It's hard not to wonder, though, Bauer said.He's said he's worried about an increase in tolls to make up for money Macquarie could be losing. The state, Bauer said, has agreed to pay the difference in toll increases for users of the I-Zoom electronic toll pass system. People with I-Zoom transponders have had tolls stay at lower rates.
"The Toll Road has always been a greater risk than people thought to begin with," Bauer said. "It's an important artery, and who knows who the next owner is going to be?"
Macquarie blasted Bauer on July 22, releasing a statement calling comments about the group's financial position "misinformed and ... contrary to publicly available information."
If a stake holder in the lease were to sell off their share, INDOT's Morris said the state would only approve the sale if the new group was reputable, professional and willing to establish the same kind of business relationship the state has with Macquarie and Centra.
They also would have to agree not to go beyond the current toll formulas, which allow increases up to June 30, 2011. Beyond that date, increases are capped at 2 percentage point increase in nominal per-capita Gross Domestic Product, whichever is greater, Morris said."We have contingency plans for almost anything that could occur," he said. "That's just good business. But we don't anticipate those contingency plans being utilized at all."
Bauer says transaction 'maybe close to probable.'
By ED RONCO Tribune Staff Writer
Reports that the private manager of the Indiana Toll Road might find the next off ramp and sell its leases to raise money are not correct, said a spokesman for the Australian group.
But House Speaker B. Patrick Bauer, D-South Bend, maintains that such a transaction is possible and "maybe close to probable," despite being blasted by Macquarie's investor relations arm.
An Australian and Spanish consortium paid $3.8 billion to Indiana in 2006 in exchange for a 75-year lease on the Indiana Toll Road.
News reports, including a Bloomberg story last week, have suggested that Macquarie infrastructure Group might sell its leases on the Indiana Toll Road and the Chicago Skyway.
Traffic on the 157-mile expressway was down 9.5 percent for Macquarie's 2009 fiscal year, which ended June 30.A July 8 statement said Macquarie is reviewing options to "enhance security holder value."
The economy has had a negative effect on the value of Macquarie's Toll Road portfolio.
And with the Indiana Toll Road, revenue has increased 2.9 percent for the fiscal year, but the Bloomberg story cites a 14 percent drop in the value of the Australian dollar against the U.S. dollar, which has reduced the value of Macquarie's investments.
Macquarie Infrastructure Group spokesman Alex Doughty said speculation the group will shed the Toll Road is "simply incorrect."
"MIG is not in the market pursuing a sales process for any of its U.S. assets, including the Indiana Toll Road," he wrote in an e-mail.The Sydney-based Macquarie Infrastructure Group owns a 25 percent stake in the lease. Macquarie Infrastructure Partners owns another 25 percent. The remaining half of the lease is held by a Spanish group called Centra.
Leigh Morris, deputy commissioner for Toll Road oversight for the Indiana Department of Transportation, said he thinks a sale of the lease is unlikely, but even if it were to occur, the state would have to approve it.
"I didn't have a thing to do with negotiating the lease, but the folks that did, did a masterful job of protecting the interests of the state of Indiana," Morris said.
He acknowledged reports that Macquarie has had difficulties, "but they've also indicated that they don't believe (a sale) is likely to happen," he said. "And they kind of resent some of the speculation that's going on."
It's hard not to wonder, though, Bauer said.He's said he's worried about an increase in tolls to make up for money Macquarie could be losing. The state, Bauer said, has agreed to pay the difference in toll increases for users of the I-Zoom electronic toll pass system. People with I-Zoom transponders have had tolls stay at lower rates.
"The Toll Road has always been a greater risk than people thought to begin with," Bauer said. "It's an important artery, and who knows who the next owner is going to be?"
Macquarie blasted Bauer on July 22, releasing a statement calling comments about the group's financial position "misinformed and ... contrary to publicly available information."
If a stake holder in the lease were to sell off their share, INDOT's Morris said the state would only approve the sale if the new group was reputable, professional and willing to establish the same kind of business relationship the state has with Macquarie and Centra.
They also would have to agree not to go beyond the current toll formulas, which allow increases up to June 30, 2011. Beyond that date, increases are capped at 2 percentage point increase in nominal per-capita Gross Domestic Product, whichever is greater, Morris said."We have contingency plans for almost anything that could occur," he said. "That's just good business. But we don't anticipate those contingency plans being utilized at all."