CCR Accelerates Road Financing

Brazil’s Companhia de Concessoes Rodoviarias (CCR) is assembling an elaborate financing package to support estimated BRL2.5bn investment to operate RodoAnel, a 32km ring road around the city of Sao Paulo, say executives close to the process. The financing includes three basic stages, the second of which involves a project loan – whose structure is similar to what was used in the $3.7bn Farac I deal in Mexico – and would be a novelty for Brazil. The first stage relies on short-term bank lines. UBS Pactual underwrote a BRL650m 1-year bridge loan to CCR RodoAnel, the private concessionaire, at CDI plus 125bp. In May, the borrower syndicated BRL350m of the line by issuing promissory notes to four banks including SocGen, ABC Brasil and Banco Alfa, and will in the coming month begin syndicating the remaining BRL300m. CCR has also tapped Santander and Bradesco for a BRL600m bridge at a rate of CDI plus 100bp-110bp, says an executive involved. A second stage, still being finalized, will include a roughly $200m IDB A loan, and a $700m 7-year bullet B loan, called a mini-perm, which carries a cash sweep. Pricing on the B tranche, to be led and syndicated by Depfa, could come in a Libor plus 140bp-200bp range, says the official. The mini-perm, extendable by 8 years, will be used to take out the BRL bridge loans. A BRL hedge may also be put in place since the dollar liability would be paid down with BRL revenues. A third stage involves issuing local and or international bonds to take out the mini-perm. CCR won a concession for the RodoAnel in March. It was also among the bidders for Farac I last year in a group with Portugal’s Brisa, Mexico’s La Nacional and Merrill Lynch, heard to have offered a $3.3bn 26-year bond to finance the concession.