SAN JUAN Puerto Rico officials on Monday picked a consortium including Goldman Sachs Infrastructure Partners II LP (GS.N) for a $1.08 billion public-private partnership to operate two of the Caribbean island's main roads for 40 years.
The Autopistas Metropolitanas de Puerto Rico LLC group also included the Spanish infrastructure group Abertis Infraestructuras (ABE.MC) and offered an upfront payment 12.5 percent more than a competing bid placed by a consortium comprised of Morgan Stanley Infrastructure (MS.N) and OHL Concesiones to operate the PR-22 and PR- 5 roadways.
The bid was 20 percent more than the government's internal estimate of $902 million, according to David Alvarez, executive director of the Puerto Rico Public Private Partnership Authority.
In addition, the Autopistas group will invest $56.1 million during the contract's first three years to repair lighting, signage, toll plazas and other infrastructure, plus an estimated $300 million over the life of the contract in basic maintenance.
The group will also pay $450,000 annually, plus an additional $450,000 every seven years, to the Puerto Rico Police Department to ensure current levels of service are maintained over the life of the contract.
The highway concession is one of several private-public partnership deals that government officials are working to bring to market. Governor Luis Fortuno is banking on such deals with the private sector to finance infrastructure projects and help lift Puerto Rico out of its five-year recession and ease high unemployment.
(Reporting by Reuters in San Juan; additional reporting and writing by Michael Connor in Miami; Editing by Leslie Adler)