May 99 Deal of the Month

Highway 407

C$3.1 billion

If anyone's driven around Toronto (as we have many times, including the days when studs were allowed on car tyres - that's for the ice and snow in case anything else came to mind), then surely the 22-lane stretch on Highway 401 is a mind boggler. Next is Highway 407, which has a new 99-year concession and a DBFO deal. DBFO? Design Build Finance Operate.

Congratulations to:-

	Spain's Grupo Ferrovial (but then Italian and Spanish autoroute companies have always been in the vanguard of financings - an Italian autostrade was one of the world's very first Eurobonds in the 1950s)
	*SNC-Lavalin of Quebec (SAR?), and*
	*Capital d'Amerique CPDQ (Pretty Damn Quick?), a subsidiary of the massive Caisse de Depot et Placement du Quebec.*

The $500m DBFO deal includes:

	East Partial Extension - 15km - end 2001
	West Extension - 24km - mid 2001

The lucky bridging banks (C$2.3billion)?

	BMo (Bank of Montreal) plus $150m sub debt
	RBC (Royal Bank of Canadia)
	Citi (as in bank)

The capital markets takeaway? Soon to be done by Nesbitt Burns and SSB (no not single-side-band as in radio) Salomons. Smith and Barney are cartoon characters.....No?

Not bad for that great state/province of Ontario who'd only spent C$1.5 billion building Highway 407. Another way for the great state/province of Quebec to own the rest of Canadia? Easier than changing the constitution? Or should we have left that to the Brian and Pierre show?

Keep an eye out Canucks, the Aussies are coming.... MIG isn't a Russian fighter - It's the team from Sydney, the Macquarie warriors.

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