Pilar-Pergamino Highway

Distressed

In October 2006, OCCOVI, the Argentine highway concession control organization, awarded a 30-year concession to Corporación America-Helport to widen and build a 180 km highway in the Buenos Aires region. The first 100km planned to widen Route 8, and the final 80km was to be new construction. It connected the towns: Pilar, Capilla del Senor, San Antonia de Areco, Capitan Sarmiento, Arrecifes and Pergamino in the Buenos Aires region and was projected to shorten commutes to 1 hour. The project was the first successful initiative to qualify for a government program that gave a 5% bidding advantage to the original, private proponent of an infrastructure project. The contract was awarded through a competitive tender in which three bidding consortia submitted offers for the lowest tariff: • UTE comprised of Benito Roggio e Hijos S.A., Esuco S.A., and JCR S.A. for 11.7364 pesos; • Corporación America and Helport for 11.7340 pesos; and • CCI Construcciones S.A--Petersen Thiele and Cruz for 11.6192 pesos Although Corporación America-Helport was not the lowest bid, its 5% bidding advantage ensured preference from OCCOVI. The consortium Corporación America-Helport was created by Corporación America (CASA), an investment company, and Helport S.A., a construction company. They are both private entities controlled by investor Eduardo Enuerkian. The project reached financial closure on November 3rd, 2006 when Corporación America-Helport took possession of the portion of Route 8 earmarked in the contract. The total investment obligations were US $322 million (Argentine Peso 1 billion). The investment will be recovered through two toll booths situated at kilometer 66 and 193 of Route number 8. As of June 2012,the government was considering cancelling the project, as the concessionaire failed to undertake the investment commitments. Called OCCOVI to confirm that posession was taken. They indicated that posession was taken on November 3, 2006 although the contract specified Novemeber 1, 2006.