Project will develop toll roads connecting Cartagena and Barranquilla
In another noteworthy transaction tied to a large infrastructure project as part of the 4G road infrastructure program including 47 projects worth $25 billion, Milbank, Tweed, Hadley & McCloy LLP has advised Colombian concessionaire Concesión Costera Cartagena Barranquilla S.A.S. and its sponsors Constructora Colpatria S.A., Constructora Meco S.A., and M.H.C. Ingeniería y Construcción de Obras Civiles S.A.S. in connection with the structuring of a dual-currency project bond and financing package consisting of two tranches of bonds used to fund an extensive toll road improvement plan in Colombia.
Fideicomiso P.A. Costera is the entity created in 2014 as part of a 25-year concession with Colombia’s Ministry of Transportation to rehabilitate and operate an extensive series of highways connecting Cartagena, Colombia’s fifth largest city by population, and Barranquilla, the largest city and port in the northern Caribbean coastal region of the country.
In the first part of the offering, Fideicomiso P.A. Costera issued US$150.8 million of senior secured series A notes due 2034, yielding 6.750%. In the second portion, Fideicomiso P.A. Costera issued COP327 billion of senior secured Series B UVR-indexed notes due 2034, yielding 6.250%. Goldman, Sachs & Co. acted as the sole book-running manager and Scotiabank acted as co-manager for this transaction, which closed on July 8.
Proceeds of the issuance will support the improvement and maintenance of 112.43 km of existing toll roads and 46.86 km of new construction. The project also includes the construction and development of a bypass around Barranquilla, known as Circunvalar de la Prosperidad, that will serve to demarcate the new Barranquilla city limits and accelerate movement and access to the port zones near the Magdalena River.
Upon its completion, the project will provide a more efficient route between Colombia’s two most productive and economically important cities on the Atlantic coast.
The Milbank team was led by Global Capital Markets partner Carlos Albarracín, along with Global Project Finance partner Carolina Walther-Meade, both also members of the firm’s leading Latin American practice. The team also included Tax partner Andrew Walker, Global Capital Markets special counsel Ben Garcia, Alternative Investments special counsel Catherine Leef Martin, Global Capital Markets associates Brandon Jang, Donald Canavaggio and Alexander Barlow, Global Project Finance associates Andrés Arnaldos Montaner and Carolyn Matos-Montes, Tax associate Jules Mugema, Alternative Investments associate Ashley Shapero, and international attorney Bernardo Mocho Moura.
