Teaching Case - The Melbourne City Link

The Melbourne City Link

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  • Product Description

    Abstract:
    The Melbourne City Link, a $2 billion privately-funded highway project, was one of the first fully electronic toll roads in the world. While the government of the State of Victoria specified this innovative tolling system in the tender for the project, it left the implementation and administration to the consortium that was selected to finance, design, build, and operate the highway. This case allows students to focus on the financing of a large-scale privately financed infrastructure project through the capital markets. It is designed to teach students about the allocation of risks that are customary in project financing arrangements where lenders have limited or no recourse to the project sponsors. By analyzing the deal structure, students can assess how specific risks were allocated to the project sponsors, construction contractors, equity investors, the banking syndicate, and the government.

    Learning Objective:
    This case allows students to focus on the financing of a large-scale privately financed infrastructure project through the capital markets. It is designed to teach students about the allocation of risks that are customary in project financing arrangements where lenders have limited or no recourse to the project sponsors. By analyzing the deal structure, students can assess how specific risks were allocated to the equity investors, and the banking syndicate.

  • Other Details

    Publication Date: June 01, 1999
    Teaching Plan: Available with Educator Access
    HKS Case Number: 1539.0
    Case Author: Jay H. Walder
    Faculty Lead: Jay H. Walder
    Pages (incl. exhibits): 23
    Setting: Australia, New Zealand
    Language: English
    Funding Source: Inter-American Development Bank
    _year: Older than 2000
    _pages: 16-25
    _geography: Australia & Oceania
  • Warranty Information

    /review/1539.0.EducatorCopy.pdf, /teachingplan/1539_2.pdf

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