Infrastructure

India’s financial turmoil augurs a reckoning

25 Sep 2018

Infrastructure lender IL&FS has helped trigger market mayhem, prompting regulators to step in to try to calm investors. The boss of India’s largest bank says this isn’t a “Lehman moment”. Maybe, but the amount of bad debt and short-term funding are worrisome.

New York’s trouble: a total lack of tunnel vision

12 Sep 2018

The city’s commuters already know that its transport system is hanging by a thread. A halted project to build new tunnels underneath the Hudson river shows there are ways to make things better, but maybe not the will. Political squabbling is an obstacle, but not the only one.

Italy bridge fallout will shape infrastructure fix

16 Aug 2018

Atlantia shares have fallen 30 pct on fears the government may cancel its contracts after a fatal bridge collapse. The tragedy reinforces the case for more investment. The government’s treatment of the toll-road operator will determine whether investors are willing to play along.

Stake sales could ease CK Hutchison’s debt drag

3 Aug 2018

The ports-to-telecom conglomerate reported strong first-half results. But recent large acquisitions have left new Chairman Victor Li facing a mounting debt pile. Selling part of its Watsons health and beauty chain or Husky Energy would ease the burden without yielding control.

Brookfield pays dearly to enter the home

1 Aug 2018

The $16 bln infrastructure investor is making a detour to pick up Canada’s Enercare. A renter of residential water heaters and air-conditioning systems sits oddly inside an owner of utilities, roads and railways. Its steady growth is valuable, but a 53 pct premium is extravagant.

Malaysia taps brakes along China’s Belt and Road

5 Jul 2018

Prime Minister Mahathir Mohamad has suspended work on a $20 bln rail link between his country’s east and west coasts. It’s a rare setback for Beijing's massive infrastructure initiative. The project's importance, though, means Kuala Lumpur can afford to fight for a better deal.

Tencent gets onboard the state capitalism train

8 Jun 2018

The gaming giant and carmaker Geely are paying $670 mln to buy into a wifi unit of China Railway. Neither is an obvious choice to help bring passengers online. Still, Beijing will encourage more of these unlikely partnerships to help its public-sector behemoths pick up steam.

BT network sale has too many parties to please

29 May 2018

Infrastructure groups may be eyeing the British telco’s broadband arm. BT would need to extract a high valuation and retain control to avoid spooking pension trustees. Any buyer planning to load the business up with debt risks angering politicians eager for more investment.

Local bureaucrats struggle to come clean in China

17 May 2018

Beijing is suppressing off-balance-sheet borrowing by regional governments, while new rules ease bond issuance. Yet the gap between their legal fundraising and fiscal obligations persists, hobbling efforts to cut a $2.6 trln debt pile. Mixed messages from the centre are to blame.

Cox: Belt and Road paving way to worrying excess

17 Apr 2018

Hallmarks of speculative exuberance abound with China's plan to recreate modern Silk Road trade routes. There are fancy new banking jobs, silly conferences and creative investment ideas. The danger is the $1.5 trln initiative devolves into an epic era of capital misallocation.

D.C. subway could ride Hong Kong’s MTR

20 Mar 2018

The Washington Metro's equipment and safety woes are a smoking symbol of U.S. infrastructure ineptitude. Market-based fixes would be wise. Other cities have hired Hong Kong's mass-transit provider for help, but its property and punctuality playbook also may be replicable.

Abertis rethink would avoid bidder roadkill

8 Mar 2018

Rival bidders Atlantia and ACS are mulling a breakup of the Spanish group, reports say. It would nix the idea of a European champion. But if Atlantia forgets Spain to focus on Abertis’ other assets, it would be politically easier – and avoid a pricey bidding war.

Macquarie Infrastructure slips on $2 bln banana

22 Feb 2018

That’s how much the power-to-airport-services group’s stock plunged after the loss of fuel-oil contracts led it to slash the dividend and put assets up for sale. Getting caught out by a shifting U.S. energy mix is embarrassing. Having too much leverage compounds the damage.

Trump budget is mostly fan fiction for Republicans

12 Feb 2018

The administration called for cuts in non-military programs in its $4.4 trln budget for 2019. Last week’s two-year spending deal effectively dooms the plan, though it may offer a blueprint for GOP budget hawks. A new infrastructure push offers one hope of bipartisan dealmaking.

Macquarie takes bold dive into Danish telecoms

12 Feb 2018

Teaming up with local pension funds to buy TDC for $6.7 bln is a bet on ultra-fast broadband. It’ll be hard to cut costs at the former private equity-owned firm. Stiff competition for infrastructure assets is forcing the Aussie bank to take risks. Financial engineering may help.

Atlantia can just afford to up the ante on Abertis

9 Feb 2018

The Italian toll-road operator may raise its offer for the Spanish peer to at least 19 euros a share in cash, trumping a bid by German rival Hochtief. Despite the lack of clear cost savings, cheap funding makes the combined group’s increased leverage just about manageable.

America’s real infrastructure need is a repair kit

7 Feb 2018

President Trump wants to build gleaming new highways and railways with his $1.5 trln infrastructure plan. But the U.S. already has most of the networks it needs. Repairs and upgrades aren’t flashy, but they would produce a bigger bang for the government’s limited bucks.

BT belatedly remembers it’s a telecom business

2 Feb 2018

Under new chair Jan du Plessis, the former UK telephone monopoly seems more focused on network investment than costly TV forays. It is building more fibre internet lines and may declare a truce with rival Sky on soccer rights. That should please both regulators and shareholders.

Gasoline tax is obvious infrastructure piggy bank

18 Jan 2018

The U.S. Chamber of Commerce wants a 25 cents-a-gallon increase to raise $400 bln for investment in transportation. It seems a contrary proposal coming from a group whose members just secured huge tax cuts. But it makes sense: American gas is cheap, and a higher levy is overdue.

Mnuchin and Dudley exemplify a political dilemma

12 Jan 2018

The U.S. Treasury secretary, contradicting forecasts, expects tax cuts to pay for themselves. The New York Fed chief fears growing deficits and debt. Republicans may nod to the former but enough probably worry about the latter to hamper new outlays on infrastructure and the like.