Few infrastructure projects in Brazil better capture the complexity, resilience, and innovation required to unlock stranded assets than Nova Rota do Oeste’s (NRO) R$5.35 billion financing of the BR-163 highway in Mato Grosso. The 850km stretch, which carries more than 20% of Brazil’s agricultural exports to ports, had been stalled for years. By 2025, the long-delayed concession finally secured funding, setting a new benchmark for regulatory solutions, contractual innovation, and capital market access in Brazil’s road sector.
The path to closing was anything but straightforward. Originally awarded in 2013 to Odebrecht, construction began swiftly but financing never followed, derailed by the Carwash corruption scandal. For nearly a decade, the concession was trapped in limbo, with four failed attempts either to return it to the federal government or transfer it to a third party. In 2023, the State of Mato Grosso made the unprecedented decision to acquire control for a symbolic R$1, injecting more than R$1.7 billion to pay down debt and restart works.
“In 2022, we worked mornings devising a way to return the concession to the federal government, and afternoons trying to enable the acquisition by Mato Grosso,” recalls CEO Luciano Uchoa. “It was a bi-polar work routine.”
Negotiations involved not only state and federal governments, but also regulators, audit courts, and seven commercial banks. At stake was one of Brazil’s most strategic corridors. For the landlocked soybean powerhouse of Mato Grosso, reliable logistics are vital to sustaining its global competitiveness. “Updating Mato Grosso’s road infrastructure is an extremely urgent task,” Uchoa stresses. Once complete, the duplicated BR-163 will slash travel times, reduce logistics costs, and reinforce Brazil’s standing as the world’s third-largest soybean exporter.
The financing stands out as the first-ever capital markets deal for a consensually renegotiated concession in Brazil. Sanctioned by the Federal Court of Accounts, the structure preserved the concession rather than restarting from scratch—a solution that avoided further years of delay and safeguarded value already created.
The deal also tackled unique risks. Regulators had imposed up to R$3 billion in potential liabilities if construction milestones are not met by 2029. To mitigate that, NRO designed eight EPC contracts spreading execution risk among contractors, backed by insurance and flexible replacement provisions. “Very hard” negotiations with banks also produced innovative mechanisms to address traffic risk from a nearly parallel railway under development. These contractual solutions reassured lenders and provided a framework now influencing other sectors, from sanitation to rail.
At its core, the package combined the firepower of BNDES with capital markets participation. NRO issued R$4.875 billion in 19-year debentures, with R$4.575 billion underwritten by BNDES and R$300mn placed in the open market—the largest highway debenture with firm underwriting commitments in Brazil. A BNDES loan completed the R$5.35 billion structure.
“BNDES was involved with the concession since its beginning, and it knew us well as a result,” says Uchoa. The transaction introduced contingent tranches to secure funding for future capex before formal amendments, a first in the sector. No corporate guarantees were provided; instead, lenders relied on standard project finance collateral, including escrow accounts and pledged shares, reinforced by a liquidity support mechanism backed by state-endorsed collateral tied to agricultural levies.
The project is already delivering tangible results. On stretches where upgrades are complete, fatal accidents have dropped by 90% and travel times by more than 20%. When finished, investments exceeding BRL 9 billion will have transformed Mato Grosso’s main artery, building bypasses, duplicating lanes, and modernizing critical infrastructure.
Beyond logistics, the deal carries systemic importance. It proves that stranded concessions can be revived through cooperative renegotiation, rather than abandonment and rebidding. “It has never been the goal of the Mato Grosso government to operate it in the long run,” Uchoa notes, signaling the asset’s eventual return to private hands.
For Brazil’s infrastructure sector, the Nova Rota do Oeste financing marks a regulatory milestone that also serves as a model for unlocking investments that are poised to shape Brazil’s infrastructure landscape for years to come.
Infrastructure Financing of the Year: Brazil
Proyecto: Nova Rota do Oeste BR-163
Monto y Estructura: R$5.35 mil millones ($973 millones) de financiamiento sin recurso (Non-recourse financing):
- R$4.875 mil millones en debentures de infraestructura a 19 años.
- R$475 millones en préstamo del BNDES.
Sponsor: Concessionaria Rota do Oeste
Joint Lead Arrangers, Joint Bookrunners: BNDES, BNP Paribas
Asesor Financiero: BNP Paribas
Asesor Legal (Sponsor): Machado Meyer
Asesor Legal (Acreedores/Lender’s): Lobo de Rizzo
Administradores de Cuentas (Accounts Administrators): Bradesco BBI, Banco do Brasil
Consultores: ALG Global Infrastructure Advisors, Infraplan Consultoria
Agente Fiduciario (Trustee Agent): Vortx
All supporting financial institutions and law firms were transmitted to LatinFinance by the award category winners. For updates please email awards@latinfinance.com