The story of BrisConnections there has everything you need, and its conclusion, unresolved at the time of writing, will have wide-ranging ramifications for the way infrastructure is funded in Australia and beyond.
BrisConnections was set up by Macquarie Capital Group and the construction firms Thiess and John Holland to design, build, operate and finance a A$4.9 billion ($3.53 billion) airport toll road in Brisbane, under a 45-year concession awarded by the state of Queensland in May 2008. BrisConnections floated two months later at A$1 a share, lost 60% of its value in a day and by November had hit one-10th of an Australian cent, the lowest possible price on the Australian Securities Exchange.
The A$1.2 billion flotation, underwritten by Macquarie and Deutsche, used an instalment model in which investors paid A$1 up front, with two more payments to come in subsequent years, meaning they remain on the hook for two instalments that will each cost 1,000 times more than the trading value of the stock today.
How did it get to this? There are many components to the BrisConnections story and they all speak to the way infrastructure has become commonly funded in western markets.
