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Leighton-led bidding group in box seat for $908m Transmission Gully PPP

The Wellington Gateway Partnership, led by a unit of ASX-listed Leighton Holdings, is in the box seat to win the $908 billion contract to build the Transmission Gully road north of Wellington.

The consortium, made up of Leighton Contractors, HEB Construction, InfraRed Infrastructure General Partner, the Bank of Tokyo-Mitsubishi UFH and the Accident Compensation Corp, has entered preferred bidder negotiations with the New Zealand Transport Agency to build the 27 kilometre project as a public private partnership.

The contract is expected to be awarded by the middle of next year, and will see the winner design, build, finance, operate and maintain the road for 25 years after the expected five-year build. NZTA estimates the road will cost $908 million, the most expensive section of the $2.5 billion cost flagged for the entire 110 km Wellington Northern Corridor.

"This is one more important step in the procurement process, but there is more to be done before a PPP contract can be awarded for the project," chief executive Geoff Dangerfield said in a statement.

The rival bidder short-listed for the Transmission Gully project was Positive Connection, whose members are Fulton Hogan, Fletcher Building, Macquarie Group and the Morrison & Co-managed PIP Fund.

(BusinessDesk)

Comments and questions
10

What is ACC doing being a part of this? And, why on earth are company's outside of NZ allowed to bid on major projects?

I know that PPPs alway end up with the taxpayer paying through the nose, but hopefully the contract is (a still extreme) $908 million, not billion!
Although, with this government, who knows...

ACC is a large investor in infrastructure projects. And if multinationals can get the job done cheaper/faster, why not?

Because when you follow the money throough the community it is never really cheaper. Significant amounts of the work will be done overseas and that money leaves NZ instead of circulating.

Its the Walmart syndrome...

Infratil bidding for a monopoly asset with guaranteed Govt support... what a surprise.

After seeing what NZ incompetent engineers in Christchurch built I don't think we want any more major projects done by NZ engineers thank you.

Harsh and unjust John Henry - that is a mean statement. I wouldn't call NZ engineers incompetent - design is carried out accoring to the particular standards of the time and for your information NZ has world renowned earthquake engineers. Take note that very few buildings collapsed after two large shallow earthquake events with high acceleration. The CCTV building was managed by a fraud who faked their engineering degree and was also not from NZ. Do some research and get your facts right. Maybe try supporting your fellow countrymen instead of belittling them. Colleagues of mine (engineers)have spent a lot of time making Christchurch safe and putting themselves in harms way by entering damaged buildings to assess them structurally for yours and the publics benefit. What an ass.

Unusually for a PPP project, this one seems to be well thought out. The "success factor" in the contract is the number of accidents. The fewer the accidents, the more money they will make. So if they design a cheap and nasty road that causes lots of accidents, they will suffer. Good!

I wish they had done the same for the electricity market where the objectives are not matched by the inducements – rather the reverse!

Leighton Contractors may be Australian but they have been in New Zealand for 10 years now and employ over a thousand kiwis (not that foreign companies should be exempt from bidding anyway.)

Would those calling for foreign companies to be excluded from such projects wish to see the likes of Fulton Hogan, Fletcher etc deported from Australia?