Post by account_disabled on Mar 2, 2024 23:06:52 GMT -5
Privatization in a country may cause lasting damage to public perception of asset recycling. Previous negative experiences with privatization in a country may cause lasting damage to public perception of asset recycling. Regular public-private engagement is required before launching an asset recycling scheme. From a governmental perspective, this dialogue is important to build and ensure strong public support, as well as provide comfort that there will be enough private-sector interest to generate a competitive bid.
The Brazil example A successful example of the benefits of stimulating a variety of competitive bids can be seen in the tender process to run Rio de Janeiro’s international airport, Galeão, in The BTC Number Data winning consortium — a joint venture between Odebrecht engineering group and Changi Airport Group — offered $ billion for the deal, nearly four times the minimum bid (in Brazilian reals) and percent higher than the runner-up offer. For private investors, the value is in early sight of what assets will be included in any scheme and what the likely contractual clauses will be.
For foreign investors, national security concerns expressed by government officials and other stakeholders must be taken into consideration. This concern may be more apparent with the growing wave of populism moving across the world. Lessons for private investors and asset operators Transferring an asset from public to private ownership will generate significant risks for the new operator. The challenge for an investor is knowing when and how to undertake commercial risk transfer, when to push back to the government, and when to retain the risk.
The Brazil example A successful example of the benefits of stimulating a variety of competitive bids can be seen in the tender process to run Rio de Janeiro’s international airport, Galeão, in The BTC Number Data winning consortium — a joint venture between Odebrecht engineering group and Changi Airport Group — offered $ billion for the deal, nearly four times the minimum bid (in Brazilian reals) and percent higher than the runner-up offer. For private investors, the value is in early sight of what assets will be included in any scheme and what the likely contractual clauses will be.
For foreign investors, national security concerns expressed by government officials and other stakeholders must be taken into consideration. This concern may be more apparent with the growing wave of populism moving across the world. Lessons for private investors and asset operators Transferring an asset from public to private ownership will generate significant risks for the new operator. The challenge for an investor is knowing when and how to undertake commercial risk transfer, when to push back to the government, and when to retain the risk.