Meridiam refinances Spanish highway P3

The Paris-based fund manager, along with Acciona and Cintra, has successfully refinanced the A66 project through a €184.5m bond issue.

Meridiam Infrastructure together with Spanish developers Acciona and Cintra has successfully raised €184.5 million for the refinancing of the A66 Benavente-Zamora, an availability-based public-private partnership (PPP) project in Spain, for which the three firms won a 30-year concession agreement in 2010.

The companies were able to raise the funds by issuing a 27-year bond “despite last week’s market volatility at a 3.169 percent coupon,” Meridiam said in a statement on Thursday.

“This is Spain’s first debt capital market financed P3 and is also Meridiam’s first project in Spain,” Meridiam’s founder and chief executive Thierry Déau said. “We take great pride in this project and we’ll continue to invest here for the long term in relevant infrastructure that brings employment, quality of life and ESG-added value to Spain and its citizens.”

The project company and issuer of the bond is Sociedad Concesionaia Autovia de la Plata, in which Meridiam holds the largest share at 50 percent with Acciona and Cintra evenly splitting the balance.

“The use of the new alternative fixed income market in Spain (MARF) for financing public infrastructures on this landmark transaction with the Ministry of Development and Public Works confirms the good initiative of the Spanish authorities designing this market to diversify sources of finance on tailor-made financings,” the Paris-based fund manager said.

Under the concession agreement, Meridiam, Acciona and Cintra would build and then operate a 49-kilometre portion of the highway connecting Gijon and Seville, thus completing the North to South axis “Ruta de la Plata”. The road, which was due for completion mid-2015, opened to traffic on May 12, two months ahead of schedule.

Meridiam, Acciona and Cintra have teamed up before. In March 2012, the three companies reached financial close on A334, a 40km highway connecting Olula-Macael in Almeria to the A7 freeway in Spain’s Andalucia region, a project Meridiam originally billed as its first investment in Spain. However, the A66 road project is the firm's first project in the country to reach the operational phase, a spokesperson for Meridiam told Infrastructure Investor. The A334 project is due for completion at the end of this year, according to a press release issued by the Paris-based fund manager.

Founded in 2005, Meridiam specialises in the development, financing and management of long-term public infrastructure projects. Since its inception it has invested in 40 projects and currently manages assets worth €3.2 billion. In addition to its Paris headquarters, the firm also has offices in New York, Toronto and Istanbul.