C2 wins Intercidade Campinas Train at Tarcísio auction at B3

The consortium formed by Comporte Groupwhich operates the Belo Horizonte metro and belongs to the founding family of Gol, together with the Chinese group CRRC Sifangwon the Trem Intercidades Eixo Norte in the auction held by the government Tarcisio at B3 this Thursday (29). The only one to present a proposal, the consortium represented by Guide Investimentos offered a 0.01% discount on the financial consideration ceiling, of R$8.06 billion.

In his speech, the governor of São Paulo, Tarcísio de Freitas (Republicans), celebrated the result of the auction and remembered the next ones that are scheduled to take place throughout the year. “Your Osni, get ready, we’re going to visit B3 a lot”, he said, referring to the stock exchange craftsman who makes the auction hammer, always hit with force by the governor.

Check out the auction video:

Public and private partners

National and international investors were able to participate in the public-private partnership (PPP) competition, which covered three services and whose total investment, in updated values, is expected in R$14.2 billion over a 30-year concession period.

Of this amount, R$5.3 billion will be invested by the private partner and R$8.9 billion will be paid by the government of the state of São Paulo. Of the amount paid by the state, R$6.8 billion will originate from a loan from BNDES, within the scope of the Growth Acceleration Program (PAC). The remaining R$2.1 billion will also be financed, but the institution that will offer the credit is not yet known.

In his speech, Governor Tarcísio celebrated “the vanguard” of the type of loan made by BNDES and defended the encouragement of more credit operations project financewhich takes into account the company’s future cash flow, and not via corporate financewhich is based on the balance sheet.

“If we break this barrier, the amount of money we will bring here is enormous. We will have a lot of infrastructure projects coming out, we will arouse a lot of interest from foreign investors”, said the governor, who also stated wanting to “have a lot of coffee” with Aloizio Mercadante, president of BNDES. “We want to do more and we will do it. This partnership will go a long way”, added the governor.

One auction, three projects

The winning consortium will be responsible for the construction and operation of the Campinas intercity train (TIC), which consists of the first medium-speed train in the country; for the intermetropolitan train (TIM), which will connect the cities of Jundiaí and Campinas and will have four stops; and for the operation, maintenance and works of line 7 – Ruby of the Companhia Paulista de Trens Metropolitanos (CPTM), between the metropolitan regions of São Paulo and Campinas.

Reaching speeds of 140 kilometers per hour, the TIC Campinas should be 101 kilometers long, a stretch that can be covered in around 1 hour and 4 minutes. With delivery scheduled from 2031, each train will have a capacity of approximately 800 passengers. The fare must be a maximum of R$64, and may be subject to discounts on advance sales.

The intermetropolitan train, which will connect Campinas to the city of Jundiaí – with stops in Louveira, Vinhedo and Valinhos – should be completed in 2029 and the maximum fare should reach R$28.10.

The services contract must be signed in approximately three or four months. After this period, the transfer will begin for six months of the know-how from CPTM to the new consortium that will operate line 7 (ruby). There is also a period of one year in which CPTM will supervise the concessionaire’s operation. The fare must remain within the public fare standard for the metropolitan rail system, currently R$5.

Rules of the auction held by Tarcísio management

According to the auction rules, the bidder who offered the biggest discount on the pecuniary consideration would win, the value of which was expected to be R$268 million per year, which totals R$8.05 billion over 30 years. This is the annual amount that must be paid by the government to guarantee the fulfillment of services.

As the only proponent, the C2 Consortium won the auction despite offering a symbolic discount of 0.01%. “We had two other groups that participated until this week, but decided not to participate because their account didn’t reach there – one decided today and the other yesterday. We had a proposal, so the auction was a success”, he told People’s Gazette Rafael Benine, Secretary of Investment Partnerships for the state of São Paulo.

Although other groups tried to compete, they were unable to meet all the requirements required by the notice. As found out by the People’s Gazetteamong them was a consortium formed by CCR with Alstom, Queiroz Galvão and Hitachi, and another formed by CS Infra.

In the case of TIC, the state government will guarantee 90% of the projected demand to the concessionaire, compensating the revenue if the number of users is lower than expected.

On the other hand, if there is demand above expectations, the excess revenue will be equally divided between the granting authority and the concessionaire when it exceeds 10% of the projected amount. In TIM and line 7, the state will pay the concessionaire for each train in operation.