ISA Focuses on Diversification

Luis Fernando Alarcon, CEO of Colombia-based ISA is focused on diversifying away from energy transmission. “We have determined that we want to grow in other areas such as highway concessions and gas pipelines, among others,” he tells LatinFinance. “By 2016, we want 20% of our income to come from these other sectors,” Alarcon adds. ISA is in the process of finalizing the acquisition of a 60% stake in Cintra Chile from Spain’s Grupo Ferrovial for about $300m. It plans to exercise an option to buy the remaining 40%. “Cintra expects to finish its Ruta 5 project in Chile in a few months and we want to have the support of [Grupo Ferrovial] until that project is completed. After that we would begin working on acquiring the remaining stake,” Alarcon explains. ISA recently won Autopista de la Montana, 40-year concession which will require an investment of $2.5bn. Alarcon expects construction to begin in 2011. Elsewhere, ISA is developing fiber optic networks through its Intenexa unit, which already operates in Ecuador, Peru and Colombia. “We aspire to connect all of South America and Central America,” Alarcon says. The diversification strategy does not entail divesting electricity transmission, the executive notes. ISA is working on an environmental impact study to build and operate an electrical interconnection line between Colombia and Panama, a project it will develop with joint venture partner Etesa of Panama. BBVA is helping ISA secure financing for the project. Alarcon says ISA has already received expressions of interest from multilaterals including the IDB, CAF and IFC, as well as private banks.