Transurban has announced that Cross City Tunnel (CCT) in Sydney (Australia) has successfully raised AUD278 million (US$207 million) of non-recourse debt via a new bank debt facility with a tenor of 3 years.

The funds raised will be used to repay the existing Cross City Tunnel debt, which was due to mature in June 2017. The interest rate exposure has been hedged for the term of the facility.

The 2.1 kilometre CCT links Darling Harbour on the Western fringe of the Sydney CBD to Rushcutters Bay in the Eastern Suburbs. It consists of separate dual-lane east and westbound tunnels allowing motorists to bypass inner-city congestion and 18 sets of traffic lights. It also includes connections to the Eastern Distributor. The tunnel opened to traffic in August 2005.

Cross City Tunnel is 100% Transurban owned and under concession until 2035. As we reported in 2013, Transurban reached an agreement with The Royal Bank of Scotland (RBS) to acquire all of RBS' senior secured debt exposure to the CCT for AUD475 million.

Following the refinancing, Transurban CFO Adam Watson said:

“The re-financing was successfully executed in favorable market conditions, with the bank debt market providing optimal flexibility to refinance at competitive rates well in advance of the debt maturity.”

The project started in 2002, when a consortium of Bilfinger Berger, Deutsche Bank and Cheung Kong Infrastructure Holdings achieved a €520 million financial close and signed the concession agreements for the CCT in December 2002.

In June 2007, ABN AMRO, later taken over by Royal Bank of Scotland, (94%) and Leighton (6%) acquired the asset for US$590 million.