(Reuters) - IFM Investors of Australia agreed to pay $5.725 billion to buy the bankrupt operator of a 157-mile (253 km) toll road in northern Indiana, the investment fund said in statement.
The road operator, ITR Concession Co LLC, put itself up for sale when it filed for bankruptcy in September after it was unable to support its $6 billion in debt.
In 2006, Indiana agreed to lease the highway to ITR Concession for 75 years in return for $3.8 billion, a record for a road privatization deal. IFM will assume the responsibility for contract to operate the road, according to court documents.
ITR agreed to operate and maintain the road in return for collecting tolls.
Soon after the deal closed, the U.S. slid into a deep recession and traffic volume on the toll road in 2013 was 10.7 percent below the 2007 level, according to documents filed with the U.S. Bankruptcy Court in Chicago.
ITR Concession was owned by affiliates of Australia’s Macquarie Group Ltd and the Cintra unit of Spain’s Ferrovial SA. The money raised from the sale will go toward repaying ITR Concession’s creditors.
IFM Investors is owned by 30 Australian pension funds and manages $43 billion, according to a statement by the fund.
Reporting by Tom Hals in Wilmington, Delaware; Editing by Alan Crosby