Macquarie plans APRR refinancing

A successful refinancing of the French toll road network in the next 12 months is key to Sydney-listed Macquarie Atlas Roads’ plan to begin paying dividends to shareholders. The goal is to bring the toll road's debt down from €3.6bn to €2.7bn.

Macquarie Atlas Roads plans to begin paying dividends to shareholders if a refinancing of its French toll road Autoroutes Paris-Rhin-Rhône (APRR) goes according to plan, senior management said at the Sydney-listed toll road investor’s annual general meeting Tuesday.

Chief executive Peter Trent said Macquarie Atlas Roads does not expect to earn any cash distributions from the 2,246-kilometre toll road network until “sometime” after the completion of its refinancing, which is targeted for the first quarter of 2012. The goal, he said, is to bring the toll road’s debt down from €3.6 billion to €2.7 billion. Once distributions begin flow from APRR, Trent said they could enable Macquarie Atlas Roads “to commence dividends to investors in due course”.

APRR: Due for refinancing

The listed toll road group, created in January 2010 from the demerger of the Macquarie Infrastructure Group, hasn’t been paying dividends since its portfolio of toll roads face operational and financial challenges that need to be tackled before they can begin to yield cash to investors. Trent reminded investors that turning around the portfolio remained his top priority.

“There is no mention of buying new assets, there’s no mention of building a new road or of taking over a new company,” he said at the meeting. “For the foreseeable future, we’ll remain focused on our one objective and that is to recover value to investors from our existing portfolio.”

Not all investors at the meeting seemed pleased with Macquarie’s management of the business. A resolution to re-elect John Roberts, executive chairman of the Macquarie Funds Group, as a director gathered a significant minority “no” vote of 28.7 percent.

A second listed company created from Macquarie’s demerger of the Macquarie Infrastructure Group, Intoll, contained less risky assets such as Canada’s 407 ETR toll road. It was promptly gobbled-up by the Canada Pension Plan Investment Board, a large institutional investor, in a A$3.4 billion (€2.4 billion; $3.1 billion) takeover that closed in December 2010.