KPMG to structure 1st Minas Gerais PPP project

Brazil's Minas Gerais state government has hired KPMG Structured Finance to model its first public-private partnership project (PPP), the state government reported. The project entails putting out to concession state highway MG-050, the longest highway in the state highway network at 407km. KPMG will work in conjunction with Minas' highway authority DER and consultancy Consol. Studies into the possible concession of the highway are expected in four months, with the expectation of transferring it to a private operator in 2006. MG-050 covers an area of 50 municipalities (some 1.33 million residents) and was selected due to its importance as an integration corridor between the country's center-south and south regions. In preparation for the highway's possible concession, the DER has invested 6.05mn reais (US$2.21mn) this year on improvements. Minas Gerais was the first state to implement a PPP model in the country, with the signing of a PPP law last year. São Paulo and Goiás states have also signed similar laws, while Bahia recently submitted such a law to the state legislature. A PPP law is also under discussion in the federal congress.