Brisbane’s A$2.0 billion North-South Bypass Tunnel project, on which Mallesons Stephen Jaques acted as lead transactional lawyers for successful bidder RiverCity Motorway Consortium, has won Project Finance International magazine’s “Infrastructure Deal of 2006”.
The project is Brisbane’s first privately financed toll road and the first large scale PPP in Queensland. It involves the construction of a four lane road including a 4.7km tunnel.
As well as advising the consortium of Leighton Contractors, Baulderstone Hornibrook, Bilfinger Berger Concessions and ABN AMRO Australia, Mallesons acted for the banks financing the project. This arrangement was put in place to meet the consortium’s particular requirements and with the agreement of the banks.
Partner David Storr lead the Mallesons team acting for the consortium with partner Dominic Bortoluzzi acting for the consortium on financing aspects. David Storr and Dominic Bortoluzzi were supported by Andrew Chew, Stephen Webb and Brendan Hundt. Partner Peter Doyle with senior associate Vicki Tattley lead the team acting for the banks.
The deal featured an innovative rental feature and the debt financing included a council works facility. Through this Brisbane City Council commissioned additional works which it will pay for by repaying the debt, which is a new feature for Australian toll road financings.
During the design and construction contract negotiations, Mallesons’ lawyers drew on their significant experience of prior toll road project risk allocations. They also took into account recent events and developments in the market on large scale infrastructure projects particularly toll roads, anticipating lender concerns to achieve an appropriate balance of risk acceptable to all consortium members.
Negotiations occurred within extremely tight time frames in the bid process and final amendments were being made to the project deed with Brisbane City Council right up to execution of the project and financing agreements. Mallesons managed this process, at the same time as ensuring that the project deed dovetailed appropriately with the other project agreements, particularly the design and construction contract, the operation and maintenance contract, interface agreements, and independent verifier agreements. The team also needed to consider tax issues when structuring the arrangement.
The financing package included A$1.8 billion in debt finance and a simultaneous A$724 million initial public offering of stapled units in the RiverCity Motorway Investment Trust and the RiverCity Motorway Holding Trust.
Mallesons will continue to be involved in all aspects of the project through the implementation of the project construction phase.
Thao Oakey, Project Director of Leighton Contractors’ Infrastructure Investment division said "This is a key project for us and builds on our track record of innovating, developing and winning bids on large scale projects. It was great to work with Mallesons as a team on this landmark project and we hope to replicate that partnership on future projects."
David Storr commented “We are delighted that this project has been recognised internationally as infrastructure deal of the year. Our involvement showcased our ability to contribute diverse skills to create an integrated team from various of our offices. Together we have been able to ensure a successful outcome for a group of clients.”
- Best Project Finance Deal at FinanceAsia’s Achievement Awards 2006 - Australia and NZ.
- Best Asia Pacific Infrastructure Deal of the Year at the Project Finance International Awards 2006