Spain’s Cintra and Australia’s Macquarie Infrastructure Group are the victor in the competition for rights to operate the 157-mile Indiana Toll Road through 2081. Statewide Mobility Partners, a joint venture between the two firms, bid a lump sum of $3.85 billion for the lease rights, the state announced Jan. 24. The road cuts across northern Indiana from Ohio to Chicago, where it intersects the Chicago Skyway, which the team successfully leased in 2004 for $1.8 billion.
“Both are experienced and aggressive buyers of toll road assets,” says one observer. Indiana Gov. Mitch Daniels (R), who described the bid as an “astonishing sum,” has asked the state legislature to pass his “Major Moves” initiative so the state can move forward with the sale. The bill will bring public-private partnerships to Indiana and allow it to bridge its $3-billion transportation funding gap. Daniels envisions use of private dollars to jumpstart highway construction. “At last, we can stop dreaming and start digging,” he says.
The massive cash influx would ensure full funding of all Indiana transportation construction projects for the next 10 years. The plan calls for a $2.5-billion construction fund and spending $1.35 billion on other toll projects around the state. The amount exceeded expectations to the point where Daniels may likely pass on an extra $150 million to local governments for their transportation needs.
The lease agreement includes toll road upgrades. “This will be done through significant capital improvements over the coming years and the introduction of electronic toll collection,” says Stephen Allen, Macquarie Group’s CEO. Statewide Mobility Partners is expected to contribute $4.4 billion to maintenance and improvement of the toll road over the course of the lease, including $200 million over the next three years.