The company that operates the Indiana Toll Road recently filed for bankruptcy protection. The filing includes a plan to restructure almost $6 billion worth of debt, and marks the latest trend in failed private investments into public infrastructure.
ITR Concession Co.
ITR Concession Co. LLC, the company that operated the 157-mile road Toll Road, filed for Chapter 11 protection in U.S. Bankruptcy Court with a prepackaged plan that has been backed by a majority of its creditors. The filing proposes either selling its assets or reorganizing its business.
Business as Usual
The 58-year-old road runs across Indiana between the Ohio Turnpike and Chicago Skyway. It has been struggling for years due to a heavy debt load and lower-than-expected traffic. Indiana Gov. Mike Pence said “Hoosiers can expect business as usual” on the road that serves as a main artery through the state. The company also said that the bankruptcy is not expected to affect the operator’s 283 employees.
The Restructuring Plan
ITR Concession is owned by units of the Spanish infrastructure company Ferrovial SA and Australian investment bank Macquarie Group Ltd. The company will be following a two-track restructuring process. Chief Executive Fernando Redondo said that the company is pursuing a sale of the toll road’s assets at auction, with hopes of completion by August 1 , 2015. The proceeds will be earmarked for creditors.
As an alternate, senior creditors will swap their stakes in the company for a 95.75% stake in the reorganized ITR Concession Co. Holdings LLC. Under this plan, existing lenders have agreed they will lend $2.75 billion to help the reorganization of the new company.
Court papers show that the restructuring plan is supported by more than 87% of debtholders in amount and 89% in number.
The company is for a Oct. 21 hearing to rule on the merits of its restructuring plan.
Seek professional advice from a bankruptcy attorney to help you determine if you qualify to file for bankruptcy.