Transurban’s $9.3 billion bid – the largest tollroad acquisition to date – was rigorously assessed by the nation’s most powerful regulator, Australian Competition and Consumer Commission chairman Rod Sims, who was under pressure to stop the country’s dominant tollroad operator from becoming even bigger.
But Mr Sims said the advantages attributed to Transurban by competitors were “more perception than reality” and Transurban was declared the winner of WestConnex at the end of August after agreeing to make more of its tolling data public.
“I remember when we won, I said [to the deal team]: ‘The good news is you’ve just done the biggest deal probably you’ll ever do in your career and for me, that’s great, because it’s the end of my career. For those of you in your 20s, I apologise that you’ve peaked early because it probably will be difficult to do a much bigger deal’.”
Mr Charlton – who shaved off the beard he had grown during the deal negotiations on the morning of the announcement – said he was aware of the “responsibility” he has in successfully delivering WestConnex, both for the motorists who will use it and the investors who participated in a massive $4.2 billion equity raising, the biggest in history for an M&A deal, to help pay for it.
‘It was a big year’
But he credits “supportive investors” such as superannuation fund UniSuper, which has a 13 per cent stake, for backing management.
“It was a big year because we raised money for the West Gate Tunnel [in Melbourne] at the beginning of the year and then we came back and said, ‘OK, thank you for that, we’d like to raise money for this [WestConnex]’, and now we need to deliver on all our promises.”
Transurban also made its first foray into Canada, buying Montreal’s A25 toll road, and expanded other toll roads in Australia and the US.
The toll road company, which has a market capitalisation of almost $32 billion, now employs some 2000 people directly (most of whom are in technology) and almost 20,000 indirectly, including the people who build and maintain its roads.
Despite a stock price trading near all-time highs, not everything has gone perfectly for Transurban in 2018. Its new NorthConnex toll road in Sydney will be delayed – Charlton says it is due to open in 2020 but won’t specify exactly when – because the companies building it, Lendlease and Bouygues, had construction problems (Lendlease is now considering whether to sell its engineering business).
But the signing of the WestConnex transaction means that Mr Charlton can finally take a real holiday – three weeks – over Christmas without worrying about deal negotiations, and he will be heading to snowy Vermont with his family. “It’s the first time in six years that we haven’t had something going on.”