Macquarie, Cintra drop out of bidding for PA Turnpike; details sketchy

| 5/16/2008

With two well-known foreign toll road investment companies having pulled themselves out of the running, Gov. Ed Rendell’s deadline for accepting bids for the Pennsylvania Turnpike came and went Friday with few details released to the public.

Rendell extended the bid deadline on Monday, May 12, stating that because “some bids were within 10 percent of the highest bid, we are obligated to solicit best-and-final offers due this week. Full details will be made public once we have the highest bid.”

During his Monday press conference, Rendell also said “On May 9 we received multiple bids to lease the Pennsylvania Turnpike.”

Mainstream news outlets, including Reuters, The Wall Street Journal, The Houston Chronicle, CNN Money and the Pittsburgh Post-Gazette, reported that only three bidding entities were still in the running as of Monday – one headed by Spanish toll road operator Abertis Infrastructuras SA and another led by the familiar duo of Cintra Concesiones de Infrastructure de Transporte SA out of Spain and Macquarie Infrastructure Group out of Australia.

With the Friday deadline for final bids pending, the Pittsburgh Post Gazette reported that the Cintra-Macquarie consortium had officially notified its prospective investors on Thursday to feel free to work with remaining bidders – which it indicated were the Abertis group and another consortium that consists of the Ontario Canada Teachers Pension Plan, Transurban Group of Australia and Goldman Sachs of New York.

As of press time Friday afternoon, there had been no announcement from Rendell’s office regarding the number of final bids received. Rendell is hoping private investors will pay the state between $12 billion and $18 billion for the right to operate the turnpike for up to 75 years.

A banker from the consortium that included Cintra and Macquarie reportedly said the group did not want to increase its bid because “the numbers didn’t cut it” according to Peter Samuel, the editor and publisher of the Web site

Cintra and Macquarie already have controlling interests in the Chicago Skyway and the Indiana Toll Road, among other U.S. infrastructure investments.