de Marco, A; Mangano, G and Zou, X Y (2012) Factors influencing the equity share of build-operate-transfer projects. Built Environment Project and Asset Management, 2(1), pp. 70-85. ISSN 2044-124X
Abstract
Purpose: The purpose of this paper is to determine the fundamental factors influencing the equity share in build-operate-transfer (BOT) investments in relation to the project risk profile. Design/methodology/approach: The relationships between risk factors and equity participation into the capital structure of a BOT contract are examined using regression analysis of a dataset of toll road projects. Findings: Results suggest that the inflation rate, the size of the investment, the construction period, the solidity of the vehicle company, and the organizational structure of the project are significant variables of the equity portion of financing. Practical implications: The analysis may support project promoters by providing better understanding of the factors that might facilitate high debt leverages and by providing lending institutions with valuable information to integrate the method of determining the appropriate debt resources to be injected into a BOT project. Originality/value: The paper contributes towards growing the body of knowledge regarding the way public-private partnership initiatives are carried over and helps refine the capital structures of BOT projects.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | build-operate-transfer; equity capital; infrastructures; project finance; project management; regression analysis; risk management; roads |
| Index terms: | project finance, body of knowledge, toll, road project, project management, partnership, risk management, capital structure, regression analysis, build-operate-transfer, dataset, risk factor, promoter, organizational structure, methodology, financing, inflation |
| Subjects: | project management theory and practice, transportation engineering, contractual arrangements, risk assessment, infrastructure engineering, environmental hazards, partnership management, statistical analysis, economic analysis, sociology, research methods, data management, knowledge management, financial management |
| Topics: | Research Practice, Project Management, Sustainability, Stakeholder Management, Procurement, Engineering Principles, Risk Management, Information Management, Cost Management, Digital Applications, Organizational Design, Business Strategy |
| Descriptive scope: | 4 PCTA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here