SNC-Lavalin sells stake in Highway 407 for $3.35 billion — and that’s just 10%
In the exclusive world of private assets, putting a price tag on an investment can be a risky proposition.
It also raises a question that may have increased in importance amid the current craze over private assets: how do you put a price-tag on a toll road? As SNC could probably attest, trying to nail down the value of a toll road can indeed be a tricky thing. Mario Angastiniotis, a director in Fitch Ratings’ global infrastructure group, said the most common way to value a toll road is to take the projected cash flow over the remaining life of the asset and to discount it using an appropriate interest rate.
“It was an untested asset, because there was no history of toll roads in Ontario, and for that matter, for most of Canada,” Angastiniotis told the Financial Post in a phone interview. “So there was a lot of uncertainty as to whether people will actually use it.”
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