Eiffage enters Colombia through 4G road SPV stake acquisition

19 October 2017 - 12:00 am UTC

French developer Eiffage will participate in the SPV behind the Santana-Mocoa-Neiva 4G highway, Inframation has learned.

Two sources familiar with the transaction said Eiffage will come in as 50/50 partner with CASS Constructores in Aliadas para el Progreso SPV. The sources declined to comment on equity value of the deal, which was signed the week of 15 October.

Colombian entrepreneur Carlos Alberto Solarte currently has a 35.7% stake in the SPV, while CASS Constructores has a 30.78% interest. Estyma SA and Latinamericana de Construcciones (Latinco) have 10% and 15.4% interests, respectively. The two sides are working to reach a financial close on the transaction, according to the second source familiar.

Eiffage will in the coming weeks formally change the SPV’s ownership structure, the first source said. It is not clear what changes in the stakes will take place. 

Inframation in 2016 reported that the Aliadas para el Progreso SPV is seeking USD 462m in financing through a dual-currency, non-recourse loan. The loan has not yet closed.

Eiffage in addition to providing equity will also serve as a co-contractor for the highway construction project alongside CASS Constructores, the first source said.

​​​​​​CASS Constructores is controlled by Solarte, who is currently facing criminal charges in Colombia related to a 2009 public works contract granted to a CASS Constructores and Odebrecht consortium.

Colombia’s procurement arm ANI has said the legal process against Solarte would not have any impact on PPP concession contracts signed with ANI. Market observers have told Inframation that banks are also waiting for new legislation in Colombia to cover liabilities and procedures if corruption charges cause infrastructure projects to be returned to the state.

The first source said that the Eiffage transaction originated several months ago, prior to the allegations against Solarte. The source added that that Eiffage’s presence may strengthen the construction and equity package for banks.

Astris Finance is serving as the M&A financial advisor to CASS Constructores. Davivienda’s subsidiary Davivienda Corredores has been serving as financial advisor to the Santana-Mocoa-Neiva project.

A spokesperson for Eiffage did not respond by press time. An ANI spokesperson did not comment on the project.