Ferrovial Gains Ground In Its US Talisman State With A €1.275 Bn Deal, Ahead Of Biden’s Investment Plan

Ferrovial will have a new source of dividends in 2019 in USThe contract increases Ferrovial's presence in large infrastructure projects in the US

The Spanish construction group has been awarded one of the largest road contracts of the year in the US to expand the I-35 interstate highway in Texas, with a budget of $1,500m (approx €1.274 Bn, 20% of the group’s total 2020 revenues). The I-35 is the largest interstate highway connecting Mexico and Canada, running through the state of Texas from the Mexican border to the Oklahoma border. Most commercial trucks transporting goods between Mexico, the US and Canada use the highway. The contract, awarded by the Texas Department of Transportation, includes the design, construction and maintenance of a toll-free section of more than 15 kilometres along the interstate, including the construction of 29 kilometres of elevated viaduct lanes. The works, which are scheduled to begin in 2022, are expected to last six years. Ferrovial was chosen in 2005 as a strategic partner of the Texas government to design and build the Trans Texas Corridor 35 (TTC 35), a mega-project with an investment of up to $36 billion. It was subsequently suspended. The new work awarded includes the construction of new elevated lanes, some of them high occupancy, located between the main road and the service roads, and eight direct connectors at two different junctions; as well as the reconstruction of the general purpose lanes and bridges of the Loop 1604 motorway.

The Spanish group won the bid by joining forces with Ferrovial Construction (formerly Agromán) and its local subsidiary Webber.

Texas is one of the Group’s largest markets, both in construction and toll roads, given that its three largest consolidated concessions globally are located in that state. In construction, although the star of 2020 was the Central European subsidiary Budimex, Webber generated EBITDA of €49m (+32%). The construction portfolio fell 11% to €10.1bn, mainly due to pandemic-related delays in tenders.

The contract increases its presence in large infrastructure projects in the US ahead of the investment plan announced by the Biden administration, which could be approved in the coming weeks.