As infrastructure funds and tollroad operators prepare for the year's biggest auction, there is one player not scared to throw its weight around.
Transurban Group, the $24.3 billion tollroad giant with a stake in just about every privately-run motorway on Australia's east coast, has locked up arguably the three biggest investment banking teams and kicked off talks with potential co-investors.
Street Talk understands Transurban has Macquarie Capital, Morgan Stanley and UBS investment bankers lined up to work on its bid for New South Wales' $16.8 billion roads project, WestConnex.
It's understood the roads group has also held preliminary talks with potential co-investors including QIC Ltd, AustralianSuper, Canadian pension funds and other infrastructure investors, which it knows via its investments in other Australian tollroads.
Transurban - like its potential rival bidders - is expected to wait until NSW finalises sale details before formalising its bidding group and final line up of banking, technical, legal and accounting advisers.
However, there is plenty of positioning and preparations to take place first.
NSW and its adviser, Goldman Sachs, has been talking to interested parties in recent weeks seeking feedback on potential sale structures and timetables. The roads project is earmarked for sale later this year, with the auction scheduled to conclude in the first half of 2018.
Up for grabs is at least a 51 per cent stake in Sydney Motorway Corporation - the entity which holds the tollroad concessions.
Analysts reckon WestConnex's equity could be worth $4 billion to $8 billion based on an 8 per cent to 11 per cent targeted return for investors. However, it is a complex deal for any one buyer to take on and includes five separate tolls, one interchange and construction of the third - and most expensive - phase.
Transurban has made no secret of its willingness to own the WestConnex roads and heads to the auction as the most likely buyer.
The question is who will front up to take on the incumbent. Bankers have been scouting the globe for would-be starters in recent months, with most time spent pitching to Spanish tollroad companies and Australian infrastructure funds, such as IFM Investors.
It's a strong statement by Transurban to line up Macquarie, Morgan Stanley and UBS for its bid. The three banks played leading roles on the $7.1 billion Queensland Motorways deal in 2014 (along with Goldman Sachs which is now on the sell-side) and are regularly involved in other big infrastructure privatisations in Australia.
