Aus & NZ: Investors lodge bids for WestConnex

26 February 2018 - 12:00 am UTC

Update: This article has been changed since it was first published to include news that the ACCC is investigating whether to block Transurban’s bid for SMC on competition grounds. 

The New South Wales government received at least three credible bids for the partial sale of Sydney Motorways Corporation (SMC) ahead of Monday’s indicative bid deadline, sources said. 

But Spanish toll road group Globalvia Infraestructuras is understood to be absent from the field, following an eleventh hour decision not to contest the AUD 8bn (USD 6.3bn) auction. 

The developer held talks with HOCHTIEF-owned contractor CIMIC with a view to forming a consortium, but difficulties emerged due to the German group’s involvement in a takeover battle for Spanish contractor Abertis

It is understood the plan was to forge a group comprising HOCHTIEF and its parent ACS, CIMIC and a newly acquired Abertis with Globalvia, which has backing from pension investors including Universities Superannuation Scheme, OP Trust from Canada and Dutch pension manager PGGM.

Multiple sources involved in the process confirmed the main contenders as: 

– Transurban, with backing from Abu Dhabi Investment Authority, Canada Pension Plan Investment Board and AustralianSuper

– Netflow, a group that includes Plenary Group, Cintra, Canada’s CDPQ, Partners Group and Alberta Investment Management. 

– IFM Investors 

In its 2017 annual report released earlier this month, CIMIC said it was “currently bidding on, or had been shortlisted for”  the “WestConnex PPP investment and WestConnex Stage 3”. A spokesperson today declined to comment on whether it had lodged an indicative bid for the 51% sale of SMC.

Also circling the auction but not thought to have committed to bid teams are Australian fund managers QIC and CP2.

Goldman Sachs, and law firms Allens and Ashurst have been advising NSW Treasury on the part sale of SMC, which is expected to be finalised by the middle of the year. Ashurst advised on the scoping study for the sale.

The Australian Competition and Consumer Commission announced an “informal review” under its merger process guidelines into Transurban’s Sydney Transport Partners Consortium’s bid for SMC on Monday (26 February). 

It is calling for submissions by 19 March on whether the consortium winning the bid would “impact on any future competitive processes for toll road development, ownership and operation”; enable Transurban to “increase the charges, including administrative fees paid by motorists, for toll road usage”; and whether it “would impact upon the provision of tolling services to toll road operators”.

 

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