This article is part of a daily series of MegaProjects articles. If you want to know more about PPP projects with a considerable size visit our MegaProjects section. You can receive them by email on a daily basis.
IFM Global Infrastructure Fund (IFM GIF), a fund managed by IFM Investors, has recently announced that it has completed the sale of a 10 percent interest in ITR Concession Company LLC to the California Public Employees’ Retirement System and an interest to Allstate.
ITR Concession Company LLC is party to a concession and lease agreement between the Special Purpose Vehicle and the Indiana Finance Authority, pursuant to which the SPV operates and maintains the Indiana Toll Road (ITR), a 157-mile, limited access, divided highway in the state of Indiana.
The road spans northern Indiana, from its border with Ohio to the Illinois state line near Chicago, feeding directly into two toll roads at the state lines, the Chicago Skyway in the west and the Ohio Turnpike in the east. The concession and lease agreement grants the SPV the exclusive right to collect toll revenues from the toll road for the next 65 years. IFM GIF continues to hold more than 85 percent of the concessionaire.
Macquarie Capital and Orrick, Herrington & Sutcliffe acted as advisors to IFM Investors for this transaction.
Julio Garcia, Head of Infrastructure North America at IFM Investors, said:
“We are delighted to partner with CalPERS and Allstate as investors in this critical piece of U.S. transportation infrastructure. Since IFM GIF’s acquisition in May 2015, ITR Concession Company LLC has announced the US$200 million 80/90 PUSH Project, a major rehabilitation of a 73 mile segment of the ITR, and has successfully refinanced its acquisition financing. These initiatives are aimed at enhancing the quality of the toll road for users, targeting increased safety, and driving value for investors. IFM GIF represents more than 70 U.S. based pension funds as investors in the ITR.”
IFM Global Infrastructure Fund completed the acquisition of 100 percent of the equity in project in May 2015 at a final purchase price of US$5.725 billion.
In November 2014 the reorganization plan of the ITR Concession Company was approved by a federal bankruptcy judge in Chicago. ITR Concession previously declared bankruptcy in October 2014 on debt of more than $6 billion.
The state of Indiana leased the Indiana Toll Road to Spain's Cintra and Australia's Macquarie Group Ltd. for US$3.8 billion in 2006. Macquarie Infrastructure Partners owned 25% of the project, Macquarie Atlas Roads controled 25% and Cintra held 50%.