Privatisation of French motorways almost in gear

19th August 2005, Comments 0 comments

PARIS, 19 Aug (AFP) - France's state-controlled motorway operators are set to complete another stage of their journey to becoming privatised companies on Monday when a deadline for bids from interested investors closes.

PARIS, 19 Aug (AFP) - France's state-controlled motorway operators are set to complete another stage of their journey to becoming privatised companies on Monday when a deadline for bids from interested investors closes.

Both domestic and foreign companies are eligible to submit initial tenders to the French finance ministry for majority stakes in France's three biggest motorway operators: Autoroutes Paris-Rhin-Rhone (APRR), Societé du Nord et de l'Est de la France (SANEF), and Autoroutes du Sud de la France (ASF).

The privatisation action has stirred opposition from across the political spectrum, including from within the governing centre-right UMP party.

The French state plans to sell its 70 percent stake in APRR, 75 percent of SANEF and 50.3 percent of ASF and is expected to raise up to EUR 10bn (US $12bn). The cash will be used to pay of some of the country's substantial national debt and to finance new transport infrastructure projects.

The first offers, which will be non-binding, must contain a price. The government will then ask for firm offers and will finalise its choice by the autumn, Finance Minister Thierry Breton has explained.

After completion of the latest round of privatisations, 8,175km (5,109 miles) of France's motorways will be in private hands by the end of the year, according to an estimate from the French motorway association AFSA.

Only the Cofiroute operator has been fully privatised so far.

France's motorway operators have a contract to run the high-speed road links and raise money by levying tolls on motorists. In 2004, the operating companies made sales of EUR 6.1bn and carried debt of $24.5bn.

The number of investors likely to take part in the auction is unknown at present.

One of the France's biggest engineering and telecoms companies, Bouygues, has ruled itself out, but it is known that construction group Vinci covets ASF, in which it already holds a 23 percent stake.

Eiffage, another construction group, announced on August 12 that it had linked up with Australian investor Macquarie Infrastructure Group and could be interested in either SANEF or APRR.

Four Spanish companies are also said to be in the running -- Abertis, Cintra, Itinere and FCC -- but no more detail is known of their intentions. Italian motorway operator Autostrade has also been named.

All the companies linked to the action have declined to comment on how much they would put on the table.

But France's political class has become increasingly vocal on the subject.

The chairman of the center-right opposition UDF party, Francois Bayrou, was the first in July to condemn the government's decision to sell the companies. He vowed to try and block the privatisation bill when it is presented to parliament.

Elsewhere, prominent members of the party have condemned it as "short-termist" and a "strategic error".

Former UMP environment minister Roselyne Bachelot lamented a decision "to sell for EUR 10 billion a series of shares from which the revenue over 25 years would be 10 times higher".

A spokesman for the opposition Socialist party, Julien Dray, said the price was too low and called the decision of former socialist prime minister Lionel Jospin to start the privatisation process "an error".

Copyright AFP

Subject: French news, privatisation, French motorways, APRR, SANEF, ASF, Vinci

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