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Highlights:
- Atlas Arteria has entered an agreement to buy majority stake in Chicago Skyway.
- With this transaction, Atlas Arteria enters partnership with Ontario Teacher’s Pension Plan.
- The company plans to fund the transaction by equity raise.
Global toll roads operator, Atlas Arteria (ASX:ALX) on Tuesday (13 September 2022) shared that it has entered a contract to buy 66.67% interest in Chicago Skyway toll roads.
Three Canadian pension funds, Ontario Teacher’s Pension Plan, CPP Investment Board and OMERS Infrastructure, own Chicago Skyway. Atlas is acquiring the majority interest owned by CPP Investment Board and OMERS Infrastructure.
With this, now there is a partnership with Ontario Teachers’ Pension Plan. This pension plan still possesses 33.33% interest in the toll road.
Details of the acquisition of Chicago Skyway
Atlas Arteria informed the market that UBS Securities Australia Limited is acting as the financial advisor and RBC Capital Markets as the lead financial advisor. Both of them are also acting as underwriters, bookrunners, and joint lead managers in relation to an equity raise to fund the acquisition.
Value of the Chicago Skyway acquisition
According to today’s release, the equity value of 66.67% interest is US$2,013 million. The deal is still waiting to get regulatory approvals. This also includes getting a yes from the City of Chicago.
The company is likely to raise money to fund the transaction. Atlas Arteria said that the details of the equity raise are finalised and will be shared via ASX soon.
About Chicago Skyway Toll Road
Skyway Concession Company LLC (SSC) operates, manages and maintains the Chicago Skyway under a 99-year concession agreement.
Chicago Skyway is a 12.5 kilometre long toll road that joins downtown Chicago and the south-eastern suburbs. It is a crucial part of the Chicago Road network that delivers time-saving and reliability for its users in the US’s busiest corridors.
Dividend announced by Atlas Arteria
The company, today, announced a dividend of 20 cents per stapled security for the six months ending on 30 June 2022. The distribution announced is in line with the guidance provided while sharing the half-yearly results.
The dividend is unfranked and is expected to be paid on 3 October 2022.
Atlas Arteria's share price snapshot
Today, Atlas Arteria shares are not going anywhere, as the company has requested for a trading halt on the pending announcement regarding a substantial transaction and capital raise.
Reportedly, Atlas Arteria shares would commence normal trading on ASX after the company announces completion of the institutional component of the offer or on 19 September 2022, whichever occurs earlier.
The share of Atlas last traded at AU$7.81 per share. The share price has dropped by 1.64% in the last five trading sessions. In the last six months, it recorded a surge of 18.87%, and a yearly rise is 16.39%. On a year-to-date basis, the share price has increased by 12.86%. Atlas's share price rose nearly 45% in the past five years.
