An infrastructure concession claim.
- 01$1.4bnAmount claimed
- 025Expert reports filed
- 039 daysEvidentiary hearing
- 04PCAAdministering body
Our team was appointed by claimant’s counsel to quantify losses following the early termination of a toll-road concession by a host government—a matter turning on the value of lost future cash flows and the appropriate rate of pre-award interest.
The question
The state terminated a thirty-year concession midway through its term, citing public-interest grounds. The tribunal needed to determine the value of the concession at termination and the interest that should run from that date, each hinging on traffic forecasts and the investor’s cost of capital.
Our approach
We rebuilt the concession’s financial model from lender base cases, calibrated traffic forecasts against actual volumes and regional growth, and separated the time value of money from compensation for risk. Interest scenarios were presented side by side so the tribunal could see the effect of each legal choice.
The evidence
The respondent’s expert relied on a book-value approach that ignored the remaining concession term. Our evidence showed that lenders and rating agencies had consistently valued the asset on its forward cash flows, and the tribunal questioned both experts closely on traffic forecasts over two sessions.
The outcome
The tribunal adopted a forward-looking valuation and awarded pre-award interest on a basis close to our primary scenario. The confidential result cannot be disclosed, but interest alone represented a significant share of the total recovery.
On a long concession, the interest question can be worth as much as the valuation itself.