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Abertis, through its subsidiary controlled by Arteris, Autovías, S.A., has reached a agreement with the Sao Paulo State Transportation Regulatory Agency (ARTESP) for a new capex program to increase capacity over a 14 kilometre segment of SP-318 (between km 249 and 253)
The total project investment is estimated at R$91 million (US$38 million).
The works, which will be finished by June 2016, will improve the service levels for 1.5 million people in the Sao Carlos, Araraquara, and Ribeirao Preto.
As a consequence of this investment, the Autovias' concession term will be extended by an estimated 6 months, thus maturing in May 2019.
This agreement highlights Abertis' ability to create value for its shareholders through win-win contract renegotiations with granting authorities. Furthermore, this kind of agreement sets an example of future negotiations with administrations.
Autovias had a 20-year concession to operate the toll road services of five small adjacent roads in the interior of the state of São Paulo, which the state regulatory agency ARTESP granted under a single concession in 1998. The five roads consist of 316 kilometers and 5 toll plazas and have an estimated annual traffic of 44 million of equivalent vehicles. The region covered by the concession comprises eighteen cities with an estimated population of around 1.6 million people.