May 2004 Financial News

RBTT Lends US $130 million

May 04, 2004

US$130-m loan for Highway 2000

Source:Jjamaica Observer Business Reporter
Friday, April 30, 2004



TransJamaican Company, the concessionaire for Highway 2000, has secured a US$130-million loan through RBTT Merchant Bank of Trinidad and Tobago to complete construction of phase 1A of the road.

The company says that the loan will ensure the "orderly development" of the project.

"We feel this loan is as important a milestone as signing the concession agreement," says Trevor Jackson, managing director of Trans Jamaican Highway (TJH). "The financing of phase 1A is now secure, ensuring the orderly development of the project."

This phase of the project, a section of which is already completed, includes:

. the Old Harbour dualisation and Vineyards toll plaza (opened in September 2003);

. the Kingston to Bushy Park and Spanish Town ramp plaza (scheduled to open in early 2005); and

. the new six-lane Portmore causeway and Hunt's Bay bridge (scheduled to open January 2006).

Part of the US$130-million will go towards repaying a US$50 million bridge loan that RBTT had provided to fund the early stage of the project. This facility was due for repayment by the end of 2004.

To raise the US$130 million, RBTT floated two bonds - one to be repaid over seven years, and the other over 10 years. Both were fully subscribed by investors from the region.

"RBTT is proud to be associated with this project, which we feel is integral to the future of Jamaica," said an executive, Christopher Mack. "As we have seen in other parts of the world, the development of a country's transportation network through projects such as Highway 2000 is a catalyst for its economic development and prosperity."

Kingsley Thomas, chairman of the National Road Operating and Constructing Company Limited (NROCC) - the government agency which monitors Highway 2000's construction - said the loan was "a vote of confidence by regional investors for Highway 2000 and for Jamaica".

Phase 1A of the project is funded through the private sector as well as TJH and its shareholders, who will recoup their investment and repay the RBTT loan strictly through revenue generated from toll payments.

NROCC has also provided loans for the funding for phase 1A of the project and also bought on behalf of the government, the land used in the construction of the highway. NROCC will recoup this expenditure from the toll proceeds.

Highway 2000 is a four-to-six lane controlled-access, tolled motorway being built by a partnership that includes NROCC, TJH, the Jamaican branch of the French firm Bouygues Travaux Publics and Jamaican Infrastructure Operator. The highway will eventually connect Kingston to Montego Bay and Ocho Rios.