Atlas Arteria (ASX:ALX) has failed in its attempt to raise fares by up to 40 per cent on the Dulles Greenway tollroad near Washington DC, after Virginia’s Supreme Court rejected its appeal. The court stated that the Greenway, which commenced operations in 1995, was “launched with flawed assumptions.” Atlas Arteria is an Australian company that invests in and operates toll roads globally, aiming to deliver sustainable returns to securityholders through efficient asset management and strategic acquisitions. It currently has stakes in toll roads in Europe and North America.
The Supreme Court rejected Atlas Arteria’s arguments that it should be permitted to make “a reasonable rate of return,” asserting that the company had no “ironclad guarantee of profit.” This decision upholds the previous rejection of the proposed rate increase by Virginia regulators in September. The proposed increase had been heavily contested by users of the tollroad.
Atlas Arteria has indicated that a pending case against the US state of Virginia, which was put on hold during the appeal process, will now proceed. In this case, Atlas Arteria alleges that the state attempted to force the tollroad into bankruptcy. The outcome of this case could have significant implications for the future of the Dulles Greenway and Atlas Arteria’s investment in the asset.