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GZI Transport Acquired Shantou Bay Bridge for HK$303 Million

Date: 2002-11-04
View Count: 46

In October 2002, GZI Transport acquired 30% stake in Shantou Bay Bridge for HK$303 million.

 

Shantou Bay Bridge, which has been in operation since December 1995, has total length of 6.5 km including bridge length of 2.5 km and southern and northern connecting routes of 4.0 km. The bridge links Shenshan Expressway in the south and Shanfan Expressway in the north connecting traffic in coastal regions of Fujian Province and Guangdong Province. The bridge has an operation period of 35 years until December 2028.

 

During the first nine months of 2002, daily average traffic volume of Shantou Bay Bridge was approximately 12,819 vehicles, representing an 11% growth compared with the same period in 2001. Total turnover during first nine months of 2002 increased by 12.6% compared with the same period in 2001. During the same period in 2002, weighted average toll revenue per vehicle was Rmb27.95, which increased by 1.4% compared with the corresponding period in 2001. The internal rate of return of the investment is approximately 15%.

 

At the end of 2001, GZI Transport disposed 55% stake in Xinfeng Highway and 82% stake in Dongyang Highway. The acquisition of Shantou Bay Bridge can replenish the toll road portfolio of GZI Transport. When comparing to the above two disposed projects, Shantou Bay Bridge is an expressway project with longer operation period of 27 years. (The cooperation period of the former two projects were 20 years and 14 years respectively.) Moreover, after the imminent completion of the Fujian Coastal Expressway by the end of 2002, coastal expressways in eastern China will all be linked up together. As the traffic hub along the coastal expressways, Shantou Bay Bridge links up the three special economic zones of Xiamen, Shantou and Shenzhen. Toll volume and revenue will have tremendous growth. In addition, rising affluence of coastal region and growing car ownership would also cause traffic volume to increase. Acquiring 30% stake in Shantou Bay Bridge not only provides immediate cash inflow to the company and long term stable revenue growth, but would also enhance shareholders’ return.

 

GZI Transport currently owns and operates 14 toll roads in and outside Guangdong Province with a total length of 783.6 km and net asset value of HK$3.08 billion. As a prudent toll road investor and operator, GZI Transport would continue to selectively invest in high quality toll road and bridge projects with promising return.

 

Contact: Sophia Yan, Executive Director of Guangzhou Investment.
(Tel: 852-21168022, Fax: 852-25987688)

 

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