Industry Funds Management (IFM) has reached an agreement to acquire a 100 per cent equity interest in an Indiana toll-road.
In a statement issued by IFM Investors, the firm said the fund will acquire the ITR Concession Company (ITRCC) – the concessionaire and operator of an Indiana toll-road in the United States – for US$5.73 (AU$7.51) billion, pending regulatory approvals.
Commenting on the acquisition, IFM Investors global head of infrastructure Kyle Mangini said the purchase is the firm’s biggest overseas investment.
“ITR represents a rare opportunity to acquire a large, high-quality, US-denominated transportation asset, giving our investors' direct linkage to US GDP and CPI,” Mr Mangini said.
“[The road] is a core infrastructure asset with defensive characteristics, demonstrated by strong financial resilience during the recession.
“IFM Investors views the Indiana Toll Road as an essential operating asset for its strategic geographical position, long concession duration and inflation and GDP-linked tolling regime,” he said.
The firm also said the concession agreement requires ITRCC to operate and maintain the road and grants the ITRCC the exclusive right to collect toll revenues during the term of the agreement.
“For the next 66 years, the asset will deliver direct linkage to US CPI and GDP. ITRCC also earns rental income from roadside travel plazas along ITR,” a statement from IFM Investors said.