State-backed Colombian electricity group ISA announced yesterday that it had concluded the purchase of a 60 percent stake in Cintra's Chilean roads business.
ISA paid $290 million for the majority stake using proceeds from an earlier rights issue and bank debt, it said in a statement. As part of the deal, ISA has an option to buy the remaining 40 percent of Cintra Chile at a later date, although there have yet to be any negotiations regarding timeline and price, it added.
The stake purchase was a long time coming having been first agreed between the two companies at the close of last year. However, February's massive Chilean earthquake delayed the conclusion of the sale, as ISA assessed the damages to Cintra's Chilean concessions.
ISA yesterday praised the quality of the insurance policies covering the assets and said road traffic and toll revenues recovered swiftly in the aftermath of the quake, especially during the second quarter of the year.
Cintra Chile controls five concessions managing 907 kilometres of road across the country. They includes Chile's most important road, Ruta 5 Sur, which crosses six Chilean regions covering 70 percent of Chile's gross domestic product, 80 percent of its population and 74 percent of its vehicles.
Ferrovial-owned Cintra's Chilean business recorded more than $300 million in revenues during 2009, ISA said.
For ISA, majority owned by the Colombian government and predominantly an energy investor, the purchase is part of its stated objective of deriving 20 percent of its revenues from businesses other than electricity transportation by 2016. By that date, the company also expects 80 percent of its revenues to be generated outside Colombia.