Strabag wins Denmark’s first road PPP

Transport minister Lars Barfoed says successful completion of the pathfinder project could pave the way for more road PPPs. The Strabag-led consortium will invest €148m in the M51 road but will receive availability payments from the Danish government.

A Strabag/Zublin Scandinavia consortium has won Denmark’s first road procured as a public-private partnership – the €148 million M51 motorway.
The M51 connects Kiplev to Sonderborg, in the south of Denmark, and runs over 26 kilometres. The road should be operational by 2013 and the Strabag-led consortium will operate it for 26 years following construction. Strabag will receive availability payments from the Danish government – agreed-upon instalments which allow the authorities to regulate payments to the consortium if it does not fulfil certain contractual parameters.
The winner beat competition from local consortium Team Vejcon and a Dutch partnership of construction company Pihl and DIF.
Transport minister Lars Barfoed said in a statement that the successful completion of the PPP contract will lead the government to investigate the possibility of using the same procurement method for other road projects.