13
may
2014
infrastructure
investor
In addition to local developer Jan
de Nul, the transaction counts DG Infra,
the fund established by Belgian lender
Belfius and private equity firm Gimv, as
lead sponsor.
It is the first Belgian PPP to be wholly
financed by a project bond, and the first
greenfield project to be backed by the
European Investment Bank’s Project Bond
Credit Enhancement facility. The bond
has a maturity of 31.5 years.
Financing is fully committedbyAllianz
Global Investors and the European Invest-
ment Bank at thebeginningof theproject.
In another innovative development for a
project bond, however, the funds will only
be drawn over time during the construc-
tion phase.
The transaction brings the amount
invested in infrastructure debt by
AllianzGI, which established a dedicated
team in September 2012, to more than
€2 billion.
ASIA & ROW
THAILAND CANCELS $62BN
INFRASTRUCTURE BILL
Thailand’s Constitutional Court voted
against the government’s bill to seek 2 tril-
lionbaht (€44billion; $62billion) in loans
for infrastructure development projects.
The result of the unanimous vote,
at eight against zero, was announced by
Charter court secretary ChaovanaTraimat,
who said the legislationwas voided by the
ruling. The judgement stated that the leg-
islative procedure was ‘unconstitutional’
and ‘violated the Charter’s provision’.
The bill had been introduced by the
ruling Pheu Thai party as a way to boost
the country’s flagging economy. Thailand
posted a paltry 0.6 percent GDP growth
in the last quarter of 2013, well below the
1.4 percent it reported in the period from
June to September.
The rulingcomes aftermonths of politi-
cal upheaval inThailand. Thegovernment
is nowheadedby the caretaker administra-
tionof YingluckShinawatra, after theoppo-
sition boycotted the results of the general
election held in February.
The infrastructure bill largely focused
on the construction of high-speed train
lines to Chiang Mai, Rayong, Nong Khai
andPadangBesar on theMalaysianborder
aswell ashighways andcommuternetworks
in Bangkok.
Theoppositionhadasked the court to
decide whether it was legal for large infra-
structure projects to benefit from emer-
gency funds rather than being funded via
the normal budgetary process.
AUSSIE INFRAMARKET IN NEED OF
REFORM
Judicious use of pricing mechanisms and
strengthening transparency in the pro-
cesses for project identification, selection,
designand implementationcould increase
private investment inpublic infrastructure
as well as result in savings of A$1 billion a
year, according to Australia’s Productivity
Commission (PC), the Australian govern-
ment’s independent researchandadvisory
body on a range of economic, social and
environmental issues.
TheCommission’s recommendations
include introducing roaduser pricing, the
adoption by governments of better prac-
tice in procurement processes, govern-
ments using greater penalties for unlaw-
ful industrial disputes and leveraging
their buying power for better industrial
relations practices.
Industry Super Australia (ISA), an
umbrella organisation representing
superannuation funds, welcomed thePC’s
findings saying the report signaleda “super
breakthrough”.
InDecember 2013, ISAhadproposed
to the PC the adoption of its ‘inverted bid
model’, whichcalls for separate tenders, as
away toencourage increasedparticipation
of long-termequity investors in greenfield
infrastructure projects.
According to the model, the govern-
ment would tender for the long-term
owner-operator first, followed by separate
bids for construction, operation andmain-
tenance, and debt.
BBGI ACQUIRES THIRD
AUSSIE PROJECT
Bilfinger Berger Global Infrastructure
(BBGI) completed the purchase of a 50
percent stake in the Northern Territories
Secure Facility (NTSF).
Located on a greenfield site near
Darwin, Northern Australia, the asset is a
new 1,000-bed correctional facility with a
concession term running until June 2044.
BBGI is to receive availability payments
from the Northern Territory government,
rated Aa1 by Moody’s, during the period.
The facility’s construction is being
undertaken by a joint venture between
Australian developers Baulderstone (now
a subsidiary of Lend Lease) and Sitzler.
Honeywell will assume responsibility for
the facilitymanagement uponcompletion
of the works, while theNorthernTerritory
government will provide custodial services.
The project is expected to be operational
in the second half of this year.
NTSFwas apipeline asset in the recent
£145 million (€174 million; $241 million)
capital raisecompletedbyBBGI lastDecem-
ber. The acquisition was funded using the
fund’s existing cash resources.
NTSFmarks the third asset bought by
BBGI in Australia, after Royal Women’s
Hospital and Victoria Prisons. The fund,
which manages 28 assets, has a market
capitalisation of £511 million.
n
PUBLIC-PRIVATE PARTNERSHIPS
PUBLIC-PRIVATE PARTNERSHIPS
Thailand
: infra bill voted down
