Brazil's Ecorodovias to raise US$1.4bn for highway works

Brazil's land transport regulator, ANTT, authorized a subsidiary of concessionaire Ecorodovias to raise nearly 8bn reais (US$1.38bn) to help finance works for highways that are part of the Minas Gerais-Rio de Janeiro concession.

In 2022, EcoRioMinas won the contract to operate and improve the BR-116, BR-465, and BR-493 highways. The 30-year concession involves 727km between Rio de Janeiro and Governador Valadares in Minas Gerais state.

ANTT authorized the firm to raise 7.32bn reais via the issue of infrastructure debentures. As this kind of bond includes a tax exemption, it must be authorized by the regulator.

The financing will be structured as a project finance operation, with the business revenue serving as collateral.

Additionally, the company will raise 663mn reais through development bank BNDES. 

Works are carried out by consortium SPE ICCR Rio Minas, formed by Itinera Construções and Crasa Infraestrutura.

Under the seven-year service contract, signed in March 2024, EcoRioMinas will pay 5.3bn reais, with the main works comprising the widening of 283km and building 255 additional lanes.

The highway sector is very attractive for project finance players, as several concession contracts have concluded and more auctions are being planned.