Académique Documents
Professionnel Documents
Culture Documents
David Keller
Belisario Galarcep
Massimo Paone
Javier Vilardell
Agenda
Chile
Autopista Central
The Deal
Valuation Process
The Damodaran Modified World CAPM Model
EHV Cost of Capital Model
What Happened?
After the War of 1879 vs Bolivia and Peru, Chile entered into a
period of economic expansion led by mining and manufacturing
industries
Chile: Economy
GDP
Monetary Policy
Chile: Transportation
Infrastructure
Chile: Santiago
Main Shareholders
in Latin America
Autopista Central
Acceso Nor-Poniente (21)
Autopista Aconcagua
N
Vespucio Norte Express (29)
Trbol Quilicura
Enlace La Dehesa
Eje Kennedy
Costanera
Norte (42)
Av. El Salto
Airport
Ruta 68
Rotonda Grecia
Historical Performance:
P&L
Expected strong
operating growth
70 % of 900,000
regular urban toll
roads users are using
Autopista Central
Valuation
How Did We
Value the
Project?
Financial Projections
Financial Projections
Financial Projections
Financial Assumptions
Revenues: increase, but in a decreasing manor, during the first years (until
2010) because of the new highway opening. From 2015 onward revenues
have a stable growth of 5%, which is the Y/Y increase in the toll rate.
Gross margin: 80% which is the management target for the concession.
Financial Assumptions
The project has a highly leveraged structure which increases the risk. The book value of
interest bearing liabilities divided by the Stockholders Equity between 2006 and 2007
has been higher than 4 (4.9 and 4.2 respectively).
The project has high fixed costs compared to variable costs and thus represents a
higher operational risk. The major costs are depreciation and administrative expenses
which is normal in the public infrastructure sector
Stage Risk: The toll road is in its post-completion stage, the toll road has been
completely operational since 2006
Revenue Risk: The implementation and use of an electronic payment system has been
done successfully thus, Revenue Risk is expected to be low
Traffic Risk: Santiago represents 32% of the overall Chilean population, the GDP of the
zone encompasses approximately 40% of the total Chilean GDP
Kapsch Group
SICE
Q-Free ASA
Currency risk: very low as the fluctuation range against the US dollar in the
past five years has been moderate. The stability of the Chilean Peso has
also been helped by a more than reputable Chilean Central Bank and its
monetary policy dedicated to control inflation level
Capital Structure
Bonds:
23-year, fixed-rate bonds were placed in both the local market
as well as in the US
Local bonds: equivalent to USD 353 million (2003) were issued
in an inflation indexed currency (Unidades de Fomento ) the
exchange rate of which was published relative to the Peso
(CLP) on a daily basis by the BCC.
Bonds placed in the US: USD 250 million
We believe that ACS should ask for the highest value obtained in
the Damodaran Modified World CAPM model or $685 million.
This value is within range that ACS will be pressing to use under
the more favorable discount rate that using the Damodaran
Modified World CAPM provides them.
What Happened?
As part of the deal Abertis took over operational control of the day
to day activities of Autopista Central.
In total, Abertis and Santander paid $1.08 billion for the 50% stake
in Autopista Central (48% stake from ACS and 2% stake from
minority shareholder) and the 50% stake that ACS controlled in
the additional toll road.
What Happened?
This value is within range that ACS will be pressing to use under
the more favorable discount rate that using the Damodaran
Modified World CAPM provides them.
Autopista Central
Q&A
Session