‘Ruta al Mar’ Highway Project Wins Big Financing Package

Colombia’s national infrastructure agency (Agencia Nacional de Infraestructura, ANI) and the Financiera de Desarrollo Nacional (FDN) national financing organization jointly announced December 14 that a new deal ensures COP$1.47 trillion (US$490 million) financing for the “Ruta al Mar” highway project linking northern Antioquia to Atlantic coastal ports.

The new financing package is a first-of-its-kind for Colombian public-private infrastructure projects, involving a combination of bonds and other investors and featuring investment-grade rankings from Wall Street bond raters Fitch and Moody’s, according to ANI.

Medellin-based Construcciones El Cóndor is the highway project developer and builder.

Commenting on the deal, FDN director Clemente del Valle stated that the financing consortium includes local banks, the FDN, debt-finance specialist Ashmore CAF, and international financiers.

FDN will provide COP$400 billion (US$133 million) or 27.17% of the total loan funds, while local banks will put-up 19.02%. Ashmore CAF assumes 18.74% and another 35.46% comes from international capital markets via purchase of Colombia’s UVR bonds.

For the deal, U.S.-based Goldman Sachs organized a COP$520 billion (US$173 million) float of bonds carrying a 26-year term and a 6.75% coupon, according to ANI.

The “Ruta al Mar” Project – linking Antioquia, Cordoba, Sucre and Bolivar departments — is part of a series of “fourth generation” (4G) highway projects around Colombia. The latest project also would smooth commerce between Valle del Cauca, the coffee regions and Atlantic ports.

The project will create bypasses around congested municipalities along the route, as well as connect to other major highways including the “Conexion Norte” and “Mar 2” highways, according to ANI.

In all, “Ruta al Mar” includes construction of 112 kilometers of new highway, rehabilitation and upgrades to another 226 kilometers of existing highway, and operations-and-maintenance of another 154 kilometers of existing highway, according to the agency.

FDN’s investors including Japan-based Sumitomo Mitsui, the U.S.-based International Finance Corporation (a division of the World Bank), and Latin America’s “CAF” multilateral investment bank.

Construcciones El Condor president Luz María Correa hailed the new financing deal, describing it as “a great milestone in financing of public-private [infrastructure] partnerships without government funds — and this validates the strength of 4G concession contracts.”