Jan. 16 (Bloomberg) -- Spanish Public Works Minister Ana Pastor said the government plans to keep propping up the “pharaonic” network of toll roads around the capital Madrid.
The Spanish government is providing junior loans and compensation payments to offset traffic volumes that have fallen short of investors’ expectations to prevent the concession companies going bankrupt, Pastor said in an interview on Onda Cero radio station today.
“There are lots of pharaonic structures” that were built during Spain’s 10-year construction boom, Pastor said. “You have toll roads with a fantastic highway running next to them so the only people on the toll road are those who’ve taken a wrong turn.”
Toll-road concessionaires have almost 4 billion euros ($5.3 billion) of non-recourse loans and the operators of three roads have already entered bankruptcy proceedings, the website El Confidencial reported last month. Obrascon Huerta Lain SA is demanding 300 million euros from the government to rescue the company operating a road to Madrid’s Barajas airport, the daily Expansion reported yesterday.
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