Quite clear from this article in the smh. Connect East was a similar deal.
July 31, 2008
Airport Link toll road manager BrisConnections units fell sharply today after listing on the Australian Securities Exchange.
Trading under the code BCSCA, BrisConnections's stapled units plummeted 59% or 41 to end at 59 cents, down from the $1 instalment price.
BrisConnections, which only joined the bourse at noon, was the second-most heavily traded ticker with 44.5 million securities changing hands.
The initial public offer of the units was fully subscribed and two more instalments of $1 apiece are due nine and 18 months after the allotment date.
BrisConnections chairman Trevor Rowe said the offer was 90% taken-up by institutions and the remainder by retail investors.
"It's clearly oversold,'' Mr Rowe said.
"It's a day-one yield of 28%, which is quite extraordinary for a high-quality project.''
BrisConnections at its initial $1 instalment price offered a first year to end-June 2009 dividend yield of 14%.
The yield is then slated to drop to a still attractive 8% until the units become fully-paid.
BrisConnections is the corporate entity for the yet to be constructed Brisbane-based toll road slated to operate between Brisbane Airport and the central business district.
The 45-year contract covers the financing, design, construction, operation and maintenance of Airport Link.
Mr Rowe said the 6.7 kilometre toll road - which will mainly consist of two tunnels - will end up closer to 13 kilometres long once the construction of a flyover is included.
"This is not a single toll road, but three multiple toll roads,'' he said.
"In that sense, it goes from the Brisbane CBD to the airport, the Brisbane CBD to the northern suburbs and from the northern suburbs straight across to the airport and free-trade zone.
"It's a high-quality road, where the tariffs have been set by the government so that it's 50% more on a per-kilometre basis than other comparable toll roads.''
Mr Rowe said Airport Link was not the same as Sydney's Lane Cove Tunnel, which has faced plenty of travails trying to force commuters off Epping Road into the tunnel - and pay handsomely for the privilege.
"This provides access for the east coast, airport, port and the trade zone which has been a nightmare,'' Mr Rowe said.
"It's a crucial piece of infrastructure.''
Mr Rowe said construction was scheduled to begin in a "month or two''.
He declined to comment on whether BrisConnections might become an eventual takeover target - Transurban and Macquarie Infrastructure Group being possible contenders.
But he said the performance of ConnectEast Group, which is building a tollway in Melbourne, was being watched with interest.
"I think ConnectEast will do well,'' he said.
Airport Link's chief sponsors are Thiess, John Holland and Macquarie Capital Advisers.
"BrisConnections has a fixed time, fixed price design and construction contract in place, guaranteed by Leighton Holdings,'' a company statement said.
The unit offer was fully underwritten by Macquarie Capital Advisers, Credit Suisse Australia, Deutsche Bank AG and JPMorgan Australia.
BCS Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
