OREANDA-NEWS. Grupo Concesionario del Oeste S.A. (GCO), an Abertis Group company in Argentina, together with the National Road Agency under the Transportation Ministry of Argentina, have signed a memorandum that formally initiates the process to extend its concession contract.

This extension involves the recognition of the pending rebalancing and an additional USD$250Mn investment plan to improve the current road network, which will be fully financed by future concession revenues, due to the extension of the current contract, which ends in 2018, until the end of 2030.

This is the first step of a process that requires other legal and governmental approvals. The closing of the renegotiation will settle previous compensation claims between the concessionaire, its shareholders and the granting authority.

The company will keep the market informed of further developments as well as of more details of this process.

With this beginning of the approval process, Abertis reinforces its commitment to public-private partnerships with the objective to find value-creation solutions for the territories through agreements with the public Administrations to make new investments in exchange for extensions on the duration of the concessions or through tariff increases.

In this sense, the Group has reached important agreements in the majority of its markets, such as France, Italy, Brazil, Chile and Puerto Rico. Moreover, this agreement demonstrates Abertis' ability to deliver growth within its existing asset base, increasing the company’s average portfolio duration.

During the first half of 2017, the Abertis Group has agreed growth deals for a total amount of close to €3.3Bn, following its strategy of creating value. Worth mentioning are the purchase of different stakes in the French Sanef to reach a 100%-stake (more than €2.2Bn); the growth in the Italian A4Holding to attain a 90%-control of the subsidiary (€215Mn); the acquisition of  two toll roads in India (more than €130Mn); and the purchase of the Rodovia dos Cal?ados in Brazil (close to €420Mn).

Abertis owns a 48.6%-stake (57.6% of voting rights) of Grupo Concesionario del Oeste, the concessionaire in charge of the construction, maintenance, administration and exploitation of the western access to the city of Buenos Aires. 56-kilometers long, it is one of the busiest road corridors in Argentina with an Average Daily Traffic (ADT) of 78.744 vehicles in 2016. The concessions ends in 2018.