Abstract
Governments around the world are decreasing their investment in public infrastructure assets and investors in the private sector are earning new or existing assets. They can decrease portfolio risk by investing infrastructure assets because essential infrastructure assets such as roads are crucial to a modern society and have high replacement costs.
Of course it is necessary to confirm whether assets value exceeds investment or not. Asset valuation for general public work project is well understood, however, less is known about how to manage the value within the context of public-private partnerships or other delivery methods.
This paper focuses on the differences between the valuation for public project and for private sector first. And secondly, it shows specific example about the valuation for toll road concession, ‘Highway 407’. Asset valuation can be explained by ‘Valuation’ which measures the value of Companies. That is to say, it uses discounted cash flows method that determines the current value of ‘Highway 407’ using future cash flows adjusted for time value. In this paper, future cash flows are evaluated by population forecast and time value is estimated by cost of capital. Finally, it examines validity about the valuation way more closely.
