MELBOURNE, AUSTRALIA – Netflow has achieved financial close on the Victorian Government’s $1.8 billion Western Roads Upgrade project, Victoria’s largest single investment in arterial roads to date.
The project includes eight high-priority road upgrades, road widenings, intersection upgrades, almost 30 kilometres of duplicated road and more than 260 kilometres of road rehabilitation and maintenance across Melbourne’s west.
The Netflow consortium – comprising Cintra and Plenary as project sponsors; WBHO Infrastructure as design and construction lead; and Ferrovial Services companies Amey and Broadspectrum as services contractor – is contracted by the Victorian Government to design, build, finance and maintain the project under a 20-year concession (plus construction).
Netflow Managing Director Phil Dreaver said the project – an availability-style public-private partnership is the first of its kind for an arterial roads project in Australia – is also great news for local industry.
“More than 1,200 job opportunities will be supported over the life of the project, with at least 10 per cent of the total hours worked being carried out by apprentices, trainees and cadets,” Mr Dreaver said.
“We have achieved more than 96 per cent local content on this project, meaning Netflow will invest some $400 million in the local supply chain.
“Our team of local subcontractors, ACE Contractors, Civilex, Fortunato, Negri Contractors and Winslow will create and retain 600 people through their workforces and supply chains alone. They’ll also invest $35 million in plant and equipment that increases their capacity to work on major infrastructure projects in the future.
“This project will help to support the rapid population growth in Melbourne’s west and provide less congestion on the roads, it will also create jobs for local workers and invest heavily in the local supply chain.
“We look forward to working in partnership with the Victorian Government to deliver this landmark project.”
In another first the finance package involves the first greenfield bond financing in Australia since the Global Financial Crisis. It is made up of 60 per cent senior secured notes provided through US Private Placement and 40 per cent via bank lenders.
Bank debt is being provided by leading domestic and international banks Westpac, Bank of China, ICBC and Mizuho.
Equity financing for Western Roads Upgrade comes from Netflow joint venture partners and project sponsors Cintra (50%) and Plenary (50%), which is in line with Netflow’s goal of investing in, developing and managing major road concession projects.
Work on the Western Roads Upgrade will begin in the first half of 2018.