APRR
Located in the east of France, APRR is France’s second largest toll
road network and Europe’s fourth largest motorway group.
About APRR
| Location | Eastern France |
| Road privatised | 2006 |
| Length | 2,424 kilometres1 |
| Number of lanes | Number of lanes varies across network |
| Tolling structure | Tolls to escalate annually in February by percentage of French CPI under concession contract:
plus supplemental toll increases as agreed with the French State. |
| Toll collection | Cash, electronic and credit card |
| Concession expiry | APRR: November 2035 AREA: September 2036 ADELAC: December 2060 A79: February 2068 |
| Related links |
APRR is a 2,424 kilometre1 motorway network located in the east of France.
APRR comprises four concessions: the APRR Concession, the AREA Concession, the A79 Concession and a minority interest in the ADELAC Concession.
APRR acts as a vital transportation corridor located at the cross-roads of Western European trade. It provides critical connectivity between major French cities, including Paris and Lyon, and access to France’s major trading counterparts.
Under the concession contracts, APRR is entitled to operate a total of 2,424 kilometre1 of motorways.
Concessionaire ownership structure
Atlas Arteria holds a 31.14% indirect interest in APRR. APRR is currently jointly owned by MAF Group and Eiffage. Atlas Arteria's interest in APRR is held through the MAF Group.
Eiffage S.A., a concession and construction company listed on the French stock exchange, holds approximately 52.00% indirect interest in APRR via a 50.0% plus one share interest in Financière Eiffarie SAS (FE) and a 4.00% interest in the MAF Group. The remaining approximate 16.86% is held indirectly by other third-party investors.
In June 2019 Eiffage and APRR as a consortium were selected as the preferred bidder on the A79. The 48-year concession contract was signed with the French Government in March 2020 and APRR took over operations of the motorway. On 30 June 2022, the ownership structure was finalised and 99.8% of ownership of A79 was acquired by APRR from Eiffage (taking APRR ownership to 99.9%).
1. Note the APRR network length of 2,424 kilometres includes ADELAC's 20 kilometres.
Ownership History
In February 2006, a consortium comprising Macquarie Infrastructure Group (MIG), Macquarie European Infrastructure Fund (MEIF) and Eiffage acquired 81.5% of APRR via a holding company Eiffarie SAS (Eiffarie). MIG had a 25.0% stake in Eiffarie and therefore an effective stake in APRR of 20.4%. MIG’s stake in Eiffarie was assumed by Atlas Arteria in February 2010, as part of the MIG demerger.
In June 2010, Eiffarie reached agreement to acquire a further 13.7% of APRR from minority holders. This gave Eiffarie a 95.2% holding in APRR, allowing it to consolidate for tax purposes and to launch a compulsory acquisition of the remaining shares. This was completed in December 2012 and APRR was delisted from NYSE Euronext Paris. Atlas Arteria did not take up its full pro-rata entitlement, and accordingly its stake in Eiffarie (and APRR) reduced to 19.44%.
In July 2014, Atlas Arteria acquired an additional 0.71% indirect interest in APRR, increasing Atlas Arteria’s indirect interest from 19.44% to 20.14%.
In October 2017, Atlas Arteria acquired an additional 4.86% indirect interest in APRR, increasing Atlas Arteria’s indirect interest from 20.14% to 25.00%.
In March 2020, Atlas Arteria acquired an additional 6.14% indirect interest in APRR, increasing Atlas Arteria’s indirect interest from 25.00% to 31.14%.
In June 2019, Eiffage and APRR as a consortium were selected as the preferred bidder on the A79. The 48-year concession contract was signed with the French Government in March 2020 and APRR took over operations of the motorway. On 30 June 2022, the ownership structure was finalised and 99.8% of ownership of A79 was acquired by APRR from Eiffage (taking APRR ownership to 99.9%). Tolling on the A79 commenced on 4 November 2022.
Road Configuration
The network is currently 2,424 kilometre1 in length. The road is mostly 2x2 lane motorway, with some of the network 2x3 lanes. There is potential to widen many of the roads if capacity is reached.
Tolls are charged on a per kilometre basis with cash, credit and ETC toll collection facilities available throughout the network.
1 The APRR network length of 2,424 kilometres includes ADELAC’s 20 kilometres.
Tolling Structure
There are five tolling categories on the APRR, AREA, ADELAC and A79 Concessions, as outlined in the below table.
| Class | Height (metres) | Number of axles | Maximum weight | Predominant vehicle type |
|---|---|---|---|---|
| 1 | >2 | 2 | <3.5 tonnes | Cars |
| 2 | ≥2 and <3 | 2 | ≤3.5 tonnes | Light Vehicles |
| 3 | ≥3 | 2 | >3.5 tonnes | Single-unit Heavy Vehicles |
| 4 | ≥3 | ≥3 | >3.5 tonnes | Multi-unit Heavy Vehicles |
| 5 | Motorcycles |
Under the concession contracts, tolls are permitted to increase annually on 1 February by a minimum of 70% x French CPI for the APRR Concession and AREA Concession. Where French CPI is negative, the minimum toll increase is 0%.
In addition, supplemental toll increases have historically been negotiated and agreed with the French State in exchange for the implementation of additional capital expenditure plans or as compensation. Refer below for details of agreed future toll escalation.
Under the A79 concession contract, tolls to escalate annually by percentage of French CPI and production cost indices: 75% x inflation + 15% x TP01 + 10% x TP09. TP01 and TP09 are production costs indices typically used in contract escalation and are capped at 4% and floored at zero. The minimum toll increase is 0%.
Subsequent Agreements with the French State
Management Contracts
In 1995 the French State set up a system of multi-year management contracts (Contrats de Plan), under which companies holding motorway concessions can implement additional capital expenditure in return for improved toll escalation rates for the term of the contract. Typically these contracts run for a five-year period.
2015 Stimulus Package (€720m)
In August 2015, a stimulus package and concession contract amendments for French motorway companies, including the APRR and AREA Concessions, were agreed and formalised with the French State.
The amendments for the APRR and AREA Concessions include the following significant measures:
- ~€720m of capex (Stimulus Package) in exchange for 2 years and 1 month of concession extension (APRR Concession) to 31 January 2035 and 3 years and 9 months of concession extension (AREA Concession) to 30 September 2036
- Compensation for the 2013 land tax increase via supplemental toll increases over 2016 – 2018
- Compensation for the 2015 toll freeze via supplemental toll increases of +0.25% for the APRR Concession and +0.26% for the AREA Concession over 2019-2023
- Other targeted measures to enhance stability of the concession contracts include:
- Improvement of protection against future adverse changes to motorway-specific taxes
- Revenue caps may apply in the event of future material outperformance
- APRR Group to contribute an annual infrastructure payment of ~€16m (indexed) to French Transport Financing Agency (AFITF) and to invest ~€50m into a green transportation fund – initiatives implemented across the French motorway companies
Maurice Lemaire Tunnel
In January 2016, the Tunnel Maurice Lemaire (TML) concession was merged into the APRR Concession. As a consequence, the APRR Concession maturity was extended by 10 months to 30 November 2035.
TML is an 11 kilometre road and tunnel between Sainte-Marie-aux-Mines (Haut-Rhin, Alsace) and Saint-Dié (Vosges, Lorraine) in eastern France. Prior to this amendment the TML Concession had a concession expiry of 2068.
2018 Motorway Investment Plan (€187m)
In November 2018, APRR and AREA formalised with the French State a capital investment plan by way of amendments to their respective concession contracts. The capital investment plan has a total value of €187m, to be partly financed by local authorities. The plan consists of 12 projects including new or improved motorway exchanges, environmental protection development as well as customer service improvements.
The additional investments will be compensated via supplemental toll increases of 0.198% per annum at APRR and 0.389% per annum at AREA over 2019-2021.
2023 Investment Plan (€410m)
In January 2023, APRR and AREA signed a €410 million capital investment plan (€310m for APRR and €100m for AREA) by way of amendments to their respective concession contracts. The investment plan consists of motorway upgrades, environmental protection, and safety developments, as well as customer service improvements. The capital investment is expected to take place between 2023 and 2030.
The agreement includes the following:
- Supplemental toll increase in 2023 of 0.06% and in 2024 to 2026 of 0.315% per annum at APRR
- Supplemental toll increase in 2023 of 0.08% and in 2024 to 2026 of 0.33% per annum at AREA
- Toll increase in 2023 of 2% on the Fleury A6 toll plaza
- Adding 0.033x to the class 4 heavy vehicle multiplier for APRR (but not AREA)
- Rescheduling of some capex related to the 2015 Motorway Recovery Plan
APRR and AREA decided that the supplemental toll increases would exceptionally not be applied in 2023.
Taxation
APRR Group, comprising APRR, Eiffarie and Financiere Eiffarie (FE), is the tax consolidated group in France. APRR generates taxable income that is offset by Eiffarie deductions.
APRR Group is expected to benefit from a progressive reduction in the French corporate income tax rate from 33.3% in 2019 to 25.0% by 2022 (per the Finance Law). Including the additional social surcharge of +3.3%, the APRR Group's applicable tax rate will reduce from 34.4% to 25.8% over this period.
Dividends
Dividends paid out of APRR are subject to conventional French accounting restrictions and can only be paid from current period profit, distributable reserves, retained earnings and share premium.
APRR has consistently generated cash flows in excess of net profit per annum. This excess cash has historically been used to fund capital expenditure and debt reduction.
Capital Expenditure
APRR’s capital works program is primarily focused on maintenance and expansion of the existing network.
Capital expenditure typically comprises three types:
- Maintenance capital expenditure (e.g. road surfacing)
- Growth capital expenditure under the concession contract (e.g. specific road widenings to ease congestion)
- Growth capital expenditure under agreed management contracts or other agreements with the French State (such as the Stimulus Package). This expenditure has historically been agreed in exchange for supplemental toll increases and/or concession extensions.
Coverage
Financials
APRR company only financials are available for purchase on the French Trade Register website via this link: French Trade Register
