Privatization

Transurban to battle IFM for Australia’s last big privatisation

To meet today's deadline, the Transurban-led team had to submit a conditional bid for WestConnex without knowing if it will receive clearance from the competition watchdog in September.

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A Transurban-led consortium has submitted a conditional bid for the WestConnex toll road project, after the New South Wales Government declined to delay the bid deadline while the competition watchdog completes its review.

Transurban confirmed its bid for 51 percent of the Sydney Motorway Corporation, the NSW Government-owned entity charged with developing and operating WestConnex, in an announcement to the ASX today. It stated it was “confident that it would obtain all necessary approvals”.

Today was the deadline for bids and the NSW Government had declined to push it back despite a delay in the decision on Transurban’s bid from the Australian Competition and Consumer Commission.

Transurban’s consortium, Sydney Transport Partners, includes minority interests from AustralianSuper, Canada Pension Plan Investment Board and Tawreed Investments.

IFM Investors, leading a consortium that includes the Canadian pension fund OMERS and the Dutch fund APG, has also submitted a bid as expected, a source with knowledge of the process confirmed to Infrastructure Investor.

The two bids are both subject to approval by the Foreign Investment Review Board, while the ACCC will not deliver a decision on Transurban’s bid until 6 September.

The NSW Government said last week it would “take the time needed” to evaluate the bids once submitted.

The A$16.8 billion ($12.5 billion; €10.7 billion) WestConnex scheme is the largest road construction project in Australia and is being built in three phases. It will comprise 33 kilometres of interconnected toll roads and motorway upgrades once complete.

With Transurban owning or having a controlling stake in 15 of 19 toll road concessions in Australia and seven of nine in NSW, the ACCC is concerned that Transurban acquiring a 51 percent stake in Sydney Motorway Corporation, could stifle competition.