Spain Approves 3 Year Aid Plan For Toll Road Operators

 

Spain's government said Tuesday the country's top political parties have agreed a EUR500 million-plus plan to provide financial aid over the next three years for toll road operators.

part of the plan, the government will provide loans for units of Abertis SA, Acciona SA, Actividades de Construccion y Servicios SA, Fomento de Construcciones y Contratas SA and Ferrovial SA, and will allow operators to increase toll fees higher than previously allowed.

Spain's public works minister Jose Blanco told parliament that Spain's government may compensate operators for any shortfall in revenue from the levels forecast when projects were approved. This year, loans for operators will total EUR200 million, with some EUR330 million planned for next year, Blanco said. The ministry didn't provide any aid estimates for 2013.

The move comes as operators are faced with falling revenue - some toll roads have seen traffic drop to between 15% and 50% of previous traffic estimates. Operators also face heavy debt servicing costs as Spain's economy continues to underperform, growing at just a 0.2% annual clip by the third quarter after it contracted in 2008 and 2009.

Blanco said operators are also threatened by higher expenses from paying compensation to land owners for ground taken to build new highways. Overall, he said these expenses may approach EUR2 billion in coming years, much higher than earlier estimates.

However, if operations in the unprofitable highways were suspended, the bill for Spain's government could be as high as EUR5.2 billion, he added.