Atlas Arteria Agrees US$100m OTPP Settlement as Dulles Greenway Litigation Dismissed

US$100 Million Settlement Removes Key Put Option Uncertainty

Atlas Arteria (ASX:ALX) has agreed to pay US$100 million to the Ontario Teachers’ Pension Plan (OTPP) to extinguish a put option tied to the Chicago Skyway asset. This move removes the risk that OTPP could force Atlas Arteria to buy its one-third stake at fair market value plus 7.5%, a clause triggered if a shareholder gains beneficial ownership of more than 50% of ALX securities.

While IFM Global Infrastructure Funds’ subsidiary, Diamond Infraco 1 Pty Ltd, has crossed the 50% voting power threshold, it has not yet reached beneficial ownership above 50%, so the put option was not triggered. Atlas Arteria expected to issue a change of control notice by 23 July 2026, but the settlement pre-empts this step.

This arrangement, unanimously supported by all directors including IFM nominees, will be funded by cash and corporate debt in two instalments over six weeks. It also eliminates the need for previously considered bridge financing. The settlement provides clarity for shareholders on future funding needs and removes a potential hurdle for IFM’s takeover ambitions.

Chicago Skyway Sale Process Paused Amid Takeover Uncertainty

Following the OTPP agreement, Atlas Arteria has paused its efforts to sell the Chicago Skyway toll road. The company and OTPP will now focus on maximising the asset’s value and await the outcome of IFM’s takeover offer, which remains contested.

The IFM bid, led by Diamond Infraco, has already surpassed 50% voting power, triggering an automatic extension of the offer period to 7 July 2026. Atlas Arteria’s Independent Directors continue to recommend securityholders reject the bid, citing undervaluation and highlighting risks associated with IFM’s majority ownership. The company released its sixth supplementary target’s statement reinforcing this stance and outlining concerns over the bid’s implications.

Dulles Greenway Litigation Dismissed, But Appeal Possible

In a separate legal development, the US District Court for the Eastern District of Virginia dismissed the 2024 federal litigation challenging toll rate changes on the Dulles Greenway, a 22km toll road fully owned economically by Atlas Arteria. The lawsuit was brought by Toll Road Investors Partnership II (TRIP II), which is now reviewing the dismissal and considering an appeal.

The court’s decision follows legislative reforms in Virginia earlier this year that streamlined toll rate applications, allowing up to two-year toll approvals and setting defined timelines for regulatory decisions. These reforms aim to reduce costs and provide greater certainty for stakeholders.

TRIP II’s most recent rate case, submitted in December 2025, remains on schedule. Atlas Arteria emphasises its commitment to constructive engagement with the Commonwealth of Virginia and local communities to sustain value and partnerships.