The Transurban Group (ASX: TCL) share price is dipping lower during afternoon trade on Friday. This comes after the toll road operator announced that it has reached financial close of the remaining interest in WestConnex.
At the time of writing, Transurban shares are fetching for $13.435, down 1.79%.
Transurban completes WestConnex acquisition
In a statement to the ASX, Transurban advised that Sydney Transport Partners (STP) has completed the takeover of WestConnex.
The New South Wales Government offloaded the last of its 49% stake in the asset for an $11.1 billion price tag. Transurban secured the initial 51% interest in 2018 for $9.3 billion.
The acquisition will take STP’s total ownership interest in WestConnex to 100%. Transurban owns 50% of STP alongside other strategically aligned partners.
This brings the company to control most of the toll roads in New South Wales, Victoria and Queensland. However, there are fears that having a dominant position, Transurban can force motorists to pay high tolls.
Transurban owns all toll roads located in Sydney, except for the Harbour Bridge and the tunnel.
The deal was funded through a combination of existing corporate liquidity and new equity that was raised in September. Transurban received $4.22 billion through a capital raise with $3.97 billion from an accelerated pro rata renounceable entitlement offer.
Transurban CEO Scott Charlton touched on the Sydney’s WestConnex project nearing completion, saying:
We feel privileged to take Sydney Transport Partners’ holding in this critical asset – one of the largest road infrastructure projects in the world – to 100%. This transaction is expected to generate significant Free Cash for the life of the concession, underpinned by strong asset fundamentals and potential upside from future infrastructure development and economic growth across Greater Sydney.
Transurban share price summary
In the past 12 months, Transurban shares have moved in circles recording nil gains for investors. When looking at year-to-date returns, the same has been logged for the majority of 2021.
The post Transurban (ASX:TCL) share price edges lower amid completion of WestConnex acquisition appeared first on The Motley Fool Australia.
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