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Current share price Stalexport Autostrady SA

3.25 zł 0% 0zł 2019-09-20

Market description

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Taking into account the condition of the road infrastructure and development needs, the Ministry of Infrastructure developed the “Programme for Construction of National Roads for the Years 2014-2023 (with a perspective until 2025)” (hereinafter referred to as the Programme). On 8 September 2015, the Programme was approved by a resolution of the Council of Ministers. The Ministry of Infrastructure and Construction updated the Programme in 2017, and the changes were approved by way of resolutions of the Council of Ministers, respectively of 25 May 2017, 20 June 2017, and 12 July 2017.

The updated document defines the objectives and priorities, both in terms of investments and of road network maintenance. The Programme indicates the material scope scheduled to be implemented in the years 2014-2023 as far as new road investments are concerned. The estimated level of capital flow for their implementation under the National Road Fund is estimated, after the update, at PLN 135 billion. This amount is allocated to the implementation of investment tasks consisting in the construction of motorways, expressways and ring roads around certain towns or cities.

Apart from the financing under the National Road Fund, the Programme provides for the construction of motorway sections in the off-budget (commercial) system, but still under the control of the public party, mostly through a special purpose vehicle operating in the road sector. In the initial Programme, this was potentially supposed to concern the construction of certain sections of the motorways A1, A2 and A18 However, in relation to the need to complete the A1 Tuszyn-Częstochowa section in the financial perspective until 2023, a decision was made, as part of the updates to the Programme in 2017, to implement it in the traditional formula, i.e. within the framework of the National Road Fund. Neither the initial Programme, nor the updated one, however, assumes financing road infrastructure in the classic public-private partnership system.

If any new invitation to public tender being of interest to Stalexport Autostrady is issued, it will be analysed by the Company and if it is positively verified and meets the strategic objectives of the Group, the Company will decide to participate in such a tender.

The Company does not exclude the option of equity investment in some of the existing concession projects in Poland if another participant of the projects is ready to quit the project or if one of the consortiums looks for additional partners with regard to capital support.

Moreover, bearing in mind the increasing level of public debt as well as the current budget deficit, one should not overlook the possibility of infrastructure privatisation in the longer-term perspective, also with regard to motorways currently under the management of the public party. The experience of Italy and France in this respect shows clearly that this instrument allows for a rapid reduction of a part of the public debt as well as for acceleration of the process of infrastructure development, in compliance with the standards of safety and quality. This issue, however, is currently not a subject of public debate.

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