Citigroup, Spanish Group Team Up for High Bid on Turnpike Lease
By Chris Forshey/AP
May 20, 2008, 07:59
A Spanish company and a unit of Citigroup have teamed up to submit the largest bid for the right to lease the Pennsylvania Turnpike for 75 years.
Governor Ed Rendell told a news conference Monday that Barcelona-based Abertis Infraestructuras - along with partners New York-based Citigroup Infrastructure Investors - offered $12.8 billion. Rendell says that was $700-million more than their nearest competitor.
Rendell has pursued the plan to have a private entity operate and maintain 500 miles of the turnpike system to raise billions for Pennsylvania's transportation needs.
He predicted the Abertis-Citi deal would generate an average of $1.1-billion a year for roads, bridges and mass transit in the first 10 years. As part of the deal, the group can raise turnpike fares no more than the rate of inflation, or 2.5-percent a year. And they’re required to maintain the terms and conditions turnpike workers’ collective bargaining agreement.
The state Legislature must still approve any deal – and that could take anywhere from several weeks to several months.
