High speed rail concessionaire files for insolvency

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High speed rail concessionaire files for insolvency

According to the local press, the concessionaire owned by ACS and Eiffage that operates the Perpignan- Figueres high speed rail (HSR) linking Spain and France has filed for insolvency.

The concession project is in trouble due to the fact that traffic is much lower than anticipated and the investment was much higher. 

This announcement comes after the concessionaire did not achieve any agreement to get a postponement of debt repayments or a debt haircut from BBVA, which was the lead arranger bank providing a loan of €382 million. Other banks involved were CaixaBank, Caja Madrid (Bankia), Banesto (Santander), ING and Royal Bank of Scotland (RBS).

The cncessionaire also failed to achieve an agreement with the Spanish and French government to get compensation for the low revenues. According to the concessionaire, the governments prioritized domestic rail traffic against the high speed rail link.

Additionally, in February this year an European Court rejected a complaint from the consortium claiming an overspending of €350 million in the construction phase due to reasons out of its control.

The 44 km rail line began commercial operations on 1 January 2013. The total project investment was €1200 million (US$1300 million), of which €600 million was provided from public funds.

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