The sales process for a stake in Melbourne’s EastLink toll road may have stalled, as owners of the asset shy away from an acquisition due to tax implications.
The process started around March but it is understood there is still no buyer.
Tax problems for owners means that groups such as the Dutch pension fund APG can’t agree a price with the seller, China Investment Corporation, which is offloading its 13.84 per interest through Goldman Sachs, say sources.
EastLink cost $2.5bn to build in 2004 and consists of the 39km Mitcham-Frankston motorway, which links the Eastern Freeway in the suburbs of Melbourne to the Frankston Freeway in Melbourne’s southeast.
It was opened in June 2008 and, after being listed, it was sold in late 2011 to a consortium for $2.2bn.
The consortium included the British-based Universities Superannuation Scheme, APG, the National Pension Service of Korea, CIC, Denmark’s Arbejdsmarkedets Tillægspension, Teachers Insurance and Annuity of the US and the Korean Teachers Credit Union.
The tax liability over the asset is thought to be about $700m and CIC’s stake is likely worth about $500m.
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