ABSTRACT
Rathmines PLC, is a large multidivisional firm with interests in mining, property and civil engineering construction in the transport and energy sectors. The firm’s board is currently considering two alternative transport investments in western Europe. Both projects are based on Build Operate Transfer (BOT) arrangements. The projects are being considered over a six-year time horizon. The first alternative is a toll bridge segment for a major orbital motorway. The second is a 25% share in a new section being added to a mass transit railway system, 70% of which is underground. In projects of this size, a major risk analysis would be carried out. The example below is highly simplified and merely demonstrates the mechanics of how the project ENPVs could be calculated.
