DF to Fund MXP38bn Subway Expansion

Mexico City’s Sistema de Transporte Colectivo (STC) expects to approach financial markets to help fund part of a MXP38bn expansion of its metro. Construction and development of the city’s new subway line, Linea 12, will consist of 2 separate funding packages, STC’s finance director Miguel Angel Avila tells LatinFinance. The first, which is estimated to come in at around MXP20bn, will finance construction and development of the line’s basic infrastructure. It will use a mixed financing structure funded by city and federal taxes. The second package – to build the trains, buy service equipment and maintain the safety and efficacy of the line – is expected to cost some MXP18bn over the next 17 years. Distrito Federal will issue a dual tranche 4-year 8 month and 9-year 8 month deal next week, via Deutsche, for up to MXP2bn. The funds are slated for infrastructure spending, at least part of which will go toward Linea 12 construction, according to a banker at Deutsche.