IPO Media Briefing

14 October 2004
Important Notice
This presentation is not and does not constitute an offer, invitation or recommendation to subscribe for, or purchase any security and neither this
presentation nor anything contained in it shall form the basis of any contract or commitment.
ConnectEast Management Limited (ACN 071 292 647) (CEML) is the responsible entity for ConnectEast Investment Trust (ARSN 110 713 481) and
ConnectEast Holding Trust (ARSN 110 713 614) (ConnectEast Group). The offer of Stapled Units in ConnectEast Group is made under a PDS
lodged with the Australian Securities and Investments Commission on 14 October 2004 (PDS). If you wish to acquire Stapled Units in ConnectEast
Group, you will need to complete the application form in, or accompanying, the PDS in paper or electronic form.
This presentation does not constitute an offer or invitation in any jurisdiction where, or to any person to whom, such an offer would be unlawful. This
presentation is being provided to a limited number of potential investors who are “qualified institutional buyers” as defined in Rule 144A of the US
Securities Act of 1933, as amended (US Securities Act) or who are not “US persons” as defined in Regulation S under the US Securities Act. This
presentation is not intended as an offer, invitation, solicitation or recommendation with respect to the purchase or sale of any security in the United
States or to any person to whom it is unlawful to make such an offer or solicitation. The Stapled Units in the offering have not been, and will not be
registered under the US Securities Act.
Reliance should not be placed on the information or opinions contained in this presentation. This presentation does not take into consideration the
investment objectives, financial situation or particular needs of any particular investor. Any decision to purchase or subscribe for Stapled Units in
ConnectEast Group must be made solely on the basis of the information contained in the PDS, if necessary, after seeking appropriate financial advice.
No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and
conclusions contained in this presentation. To the maximum extent permitted by law, ConnectEast Management Limited, Macquarie Bank Limited,
Macquarie Equity Capital Markets Limited, ABN AMRO Rothschild and Commonwealth Securities Limited, and their affiliates and related bodies
corporate, and their respective officers, directors, employees and agents disclaim any liability (including, without limitation any liability arising from fault
or negligence) for any loss arising from any use of this presentation or its contents or otherwise arising in connection with it.
The Directors’ projections of Distributions set out in this presentation are based on a number of estimates, assumptions and pro forma adjustments
that are subject to business, economic and competitive uncertainties and contingencies, with respect to future business decisions, which are subject to
change and in many cases outside the control of ConnectEast Group, CEML and its Directors. The Directors believe that they have prepared the
Directors’ projections of Distributions with due care and attention and consider all best estimate assumptions when taken as a whole to be reasonable
at the time of preparing the PDS. However, the Directors’ projections of Distributions presented in this presentation may vary from actual financial
results, and these variations may be material and, accordingly, neither ConnectEast Group, CEML nor its Directors can give any assurance that the
forecast performance in the Directors’ projections of Distributions contained in this presentation will be achieved. Details of the Directors’ projections of
Distributions and the Board of CEML’s discussion and analysis of them together with associated risk factors and the risk factors associated with an
investment in Stapled Units are set out in Sections 7 and 8 of the PDS.
Investors will be able to invest in Stapled Units issued by ConnectEast Management Limited as responsible entity of ConnectEast Investment Trust
and ConnectEast Holding Trust. A Product Disclosure Statement will be available shortly at www.connecteast.com.au or by calling the ConnectEast
Offer Hotline 1800 207 622 in Australia or 0800 507 391 in New Zealand. Investors should consider the PDS in deciding whether to invest in Stapled
Units.
ConnectEast Management Limited, Macquarie Bank Limited, Macquarie Equity Capital Markets Limited, ABN AMRO Rothschild and Commonwealth
Securities Limited have been appointed to perform services in connection with the offering of Stapled Units in ConnectEast Group, and will receive
fees, commissions and reimbursement for those services as set out in the PDS referred to above, and may have other interests in or relationships with
ConnectEast Group. All figures are expressed in Australian dollars unless stated otherwise.
2
Agenda

1 Introduction

2 Project overview

3 Investment highlights and IPO overview

4 Summary

3
1 Introduction

4
Introduction - Mitcham to Frankston
Project (MFP)
Æ ConnectEast Group

Æ Independent Board

Æ Dedicated management team

Æ Single-purpose vehicle

Æ ConnectEast Group comprises experienced and successful Australian-based

sponsors
Æ Macquarie Bank (responsible entity)
Æ Thiess and John Holland (design & construction)

Æ Construction to commence prior to the end of 2004 and expected to be

completed, under a fixed time, fixed price contract, by the end of 2008

5
Introduction - Mitcham to Frankston
Project (MFP)
Æ Low tolls - one of the lowest per km rates in Australia (approx. 18c) with a toll cap
of $4.43 for cars (adjusted for CPI)

Æ Low tolls will minimise traffic diversion

Æ In terms of design and construction and tolling technology, the MFP will be one of
the most advanced toll roads in the world

Æ Latest generation toll technology allows for greater flexibility

Æ MFP’s tolling system is designed to be fully interoperable with CityLink - there will
be no need for an extra tag

Æ MFP is expected to become a key part of Melbourne’s south-eastern road

network and will contribute to the growth and amenity of the corridor

Æ MFP will ease traffic congestion, reduce travel times and improve cross city
accessibility

Æ 39 year concession - 4 years construction (approx), 35 years operation

6
Introduction - IPO
Æ Attractive opportunity for investors
Æ Annualised distribution yield for first year equal to 11.8% on Initial Instalment
Æ Distributions of 6.5¢ per Stapled Unit per annum (expected to be fully tax deferred)
during balance of Fixed Distribution Period (ending 31 March 2010)
Æ Potential re-rating effect as observed on other greenfield toll road projects

Æ Partly paid structure – $0.55 at IPO and $0.45 12 months after Allotment

Æ ConnectEast Group sponsors to become equity investors

Æ Single purpose vehicle

Æ Bid underpinned by robust and exhaustive traffic modelling

Æ Competing routes are highly congested

Æ Project risks have been minimised

Æ Previous Australian greenfield toll roads have proven to be attractive investments

7
2 Project Overview

8
The ConnectEast Consortium
Macquarie
Macquarie Æ Co-sponsor and equity provider, equity underwriter
Æ Financial adviser
Æ Track record of success in infrastructure and toll road sectors in Australia
and around the world

Thiess
Thiess Æ Co-sponsor and equity provider
Æ D&C JV partner
Æ Turnover in 2003/04 of $2.4 billion and work in hand at end of 2004
financial year exceeded $7 billion
Æ Largest member of the Leighton Holdings Group, civil, mining and services
contractor, contributing over 40% of group operating revenue in FY04
Æ Proven track record in construction of major infrastructure projects

John
JohnHolland
Holland Æ D&C JV partner
Æ Diversified construction company with significant expertise in engineering
projects including roads, bridges, tunnelling and underground construction
Æ Turnover in 03/04 of $1.5 billion; 70% owned by Leighton Holdings

Hyder
Hyder Æ Traffic expert
Æ Global engineering consultancy with specialists in transport planning
Æ Experience includes Melbourne CityLink and Cross City Tunnel
9
The Mitcham-Frankston Project

10
Design of the MFP
Æ 39 kilometre toll road
Æ Three lanes in each direction from
Eastern Freeway at the northern
end
Æ Two lanes in each direction for
6km at the southern end

Æ Twin, 3 lane 1.5km tunnels at

northern end connecting to Eastern
Freeway
Æ Direct freeway to freeway
connections at:
Æ Eastern Freeway
Æ Monash Freeway
Æ Frankston Freeway

Æ Includes 17 major interchanges

Æ Additional 6kms of non-toll feeder
roads
Æ Ringwood and Dandenong
South Bypasses
11
Demographics of the MFP Corridor
Æ Responsible for more than 40% of Melbourne’s manufacturing output and 35% of
its employment

Æ Generates annual turnover from production activity of approximately $35bn

Æ One of the last major land release areas for commercial activity

Æ Car usage in the MFP Corridor

Æ Level of car ownership higher than the rest of Melbourne (1.68 cars per household vs.
1.49)
Æ Commuter travel by car is also higher than the rest of Melbourne (85.6% travel to work
by road vs. 75.6%)
Æ Limited public transport infrastructure

Æ More than half of Melbourne’s AM Peak trips are within or cross the MFP corridor

2003 AM Peak
Description % Trips
Trips
Trips within MFP Corridor 295,000 34%
Trips crossing into MFP Corridor 155,000 18%
Rest of Melbourne 425,000 48%
Total 875,000 100%

12
 Importance of the MFP
Æ MFP will form a key part of
Melbourne’s road network
Æ Only freeway standard north-
south arterial road
Æ Links key commercial, industrial
and residential centres in the
East and South East corridor of
Melbourne (Mitcham,
Frankston, Dandenong and
Ringwood)
Æ Key commuter road in north
and south
Æ Intra-city arterial route in middle
section
Æ Significant freight activity
anticipated
Æ Expected to substantially
reduce travel times and
improve travel time reliability
Æ Make a valuable contribution to
the growth and amenity of the
MFP Corridor
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Importance of the MFP
Æ MFP expected to attract:
Æ Business and industry taking
advantage of improved travel
efficiencies
Æ Households taking advantage of
reduced travel times to work
Æ Service companies locating
closer to new markets created
by relocation of households,
businesses and industry

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Design & Construction
Æ Design and construction is relatively low risk compared to other Australian toll
road projects
Æ Simple design characteristics
Æ Reliance on existing technology and utilisation of proven building methods
Æ Topography and geological conditions, particularly in relation to the tunnels

Æ MFP’s electronic, free-flow tolling system is designed to be fully interoperable

with Melbourne CityLink

Æ Delivery of the MFP tolling system is incorporated under the D&C contract, and
will utilise latest generation tag and video-based tolling technology

Æ Projected 49 month construction programme, with MFP operating on or before 30

November 2008

15
Design & Construction
Æ Design and Construction (D&C) to be undertaken by a 50:50 joint venture
between Thiess and John Holland

Æ Thiess and John Holland have entered into a Fixed Time, Fixed Price D&C
Contract (approx. $2.5 billion), thereby reducing risk to equity

Æ D&C Contractor is responsible for delivery of a fully operating electronic tolling

and customer service system

Æ D&C Contract includes liquidated damages regime which compensates equity (in
most cases) for delays in construction for up to 12 months

Æ Thiess and John Holland’s obligations under the D&C Contract are supported by
a parent company guarantee from Leighton Holdings (BBB+ rating)

16
Operation & Maintenance
Æ The operation and maintenance of the MFP will comprise two main areas
Æ Tolling and customer service
Æ Roadside operations and maintenance

Æ Tolling and customer service

Æ Retained in-house
Æ Ensures ConnectEast Group maintains a direct relationship with its customers

Æ Roadside operations and maintenance

Æ Initial five year contract with Transfield Services
Æ Responsible for overall freeway operation and day to day maintenance of MFP
Æ Substantially fixed price contract

Æ Transfield Services is the O&M provider on Melbourne CityLink, Lane Cove

Tunnel and for the NSW Road Traffic Authority

17
Tolling Technology and Products
Æ ConnectEast will feature the latest generation in tolling technology

Æ Developed by SICE, a division of the largest infrastructure development group in

Spain and one of the largest in Europe - 28 system installations in 18 countries

Æ SICE recently supplied the tolling system for the Autopista Central Concession in
Santiago, Chile, which has been through all of its acceptance testing and is ready
for operation

Æ The system will be based on electronic tags and readers, as per Melbourne
CityLink, and is designed to be interoperable with CityLink

Æ Greater use of the latest video tolling technology which provides more
accessibility and flexibility for motorists

Æ Features include:
Æ Low toll rates (indexed to CPI)

Æ Family friendly, neighbourhood toll discounts for cars

Æ Discounts on weekends for cars

Æ Fair and simple toll products

Æ Low fees on accounts, including a fee free product 18

Corporate Structure
Æ ConnectEast will issue Stapled Units for A$1 each – $0.55 payable at IPO and
$0.45 12 months after Allotment

Æ ConnectEast’s Stapled Unit structure is similar to other listed Australian toll roads

Æ ConnectEast Management Limited (CEML), a wholly owned subsidiary of

Macquarie Bank, will act as responsible entity of ConnectEast Group

Æ ConnectEast Asset Trust will hold the lease over the land and have the right
under the Concession Deed to finance, design and construct the MFP

Æ ConnectEast Pty Limited will have day-to-day responsibility for operating and
maintaining the MFP

19
Board of ConnectEast
Æ The Board of ConnectEast will comprise seven directors – four independent
directors, two Macquarie representatives and one Thiess representative
Æ Two independent directors already appointed with two further independent
directors currently being sought
Æ Mr Tony Shepherd – Independent Chairman and Interim Chief Executive Officer
Æ Brings relevant expertise from Transfield and setting up Transurban to develop CityLink
Æ Deputy Chairman Transfield Services Limited

Æ Dr Max Lay – Independent Director

Æ Formerly held senior positions in VicRoads and past President of the RACV and AAA
Æ Independent Reviewer on Melbourne CityLink

Æ Dr Ray Wilson (Thiess)

Æ Executive General Manager – Infrastructure & Corporate Services at Thiess
Æ Director Lane Cove Tunnel

Æ Mr David Roseman – Director (Macquarie)

Æ Head of Macquarie’s Infrastructure Advisory business in Australia and New Zealand

Æ Mr Ed Sandrejko – Director (Macquarie)

Æ Highly experienced in the Australian toll road market
20
3 Investment highlights and IPO overview

21
Financing of the MFP and use of
funds

Sources of funds $million Uses of Funds $million

Bank debt 2,0881 Construction cost 2,502

Equity Raised in the Offer 1,120 Coupon and Interest Costs 5541

Development & Financing Costs

Equity Raised via DRP 297 444
(up front and ongoing)

Deferred Equity Tranches 290 Specified Reserves 2951

Total 3,795 3,795

1 Based in interest rates as at 30 July, 2004. These balances will be impacted by the interest rates that will be set at Financial Close

22
Equity Financing ($1,707 million)
Æ Total IPO equity of approximately $1,120 million
Æ $616 million IPO equity
Æ $504 million Final Instalment

Æ Partly-paid structure with $0.55 payable on subscription and the balance of $0.45
payable 12 months after Allotment

Æ Thiess and John Holland will together contribute a Deferred Equity amount of
$260 million (on top of IPO equity) upon Construction Completion
Æ D&C equity contributed at $1.15 per Stapled Unit
Æ Deferred Equity will be subscribed for in fully paid Stapled Units and secured by Letters
of Credit (“A” rated or better)

Æ Macquarie Bank will contribute a Deferred Equity amount of $30 million 12

months after Allotment (approx. half of its advisory and sponsorship fee)

Æ Underwritten Distribution Reinvestment Plan (DRP) will contribute approximately

$297 million during construction period

23
Structure of the IPO
Æ Fully underwritten fixed price offering

Æ IPO raising $1,120 million ($616 million initial instalment) comprises

Æ Institutional offer – already completed with a core group of high quality institutions
Æ Broker Firm offer – via each of the Joint Lead Managers in Australia and New Zealand,
with a priority for Victorian investors
Æ General Retail offer – Australian residents only with priority for Victorian residents if offer
is oversubscribed

24
Equity Returns
Æ Distributions for the first 12 months equate to an annualised distribution yield on
the Initial Instalment of 11.8%

Æ Distributions (supported by cash reserves and DRP underwriting) of 6.5 cents per
Stapled Unit per annum during the Fixed Distribution Period of approximately 5.5
years (until March 2010)

Æ Distributions will be paid

Æ Semi-annually during the Fixed Distribution Period
Æ Quarterly post Fixed Distribution Period

Æ Distributions during the Fixed Distribution Period are expected to be largely tax
deferred

Æ Potential for re-rating as greenfield project risks (construction & tolling and traffic)
fall away

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 Issue Timetable*

Retail Offer (including Broker Firm) opens 22 October 2004

Retail Offer (including Broker Firm) closes 4 November 2004
Stapled Units expected to commence trading on ASX
on a deferred settlement basis 11 November 2004
Stapled Units expected to commence trading on ASX
on a normal settlement basis 16 November 2004

* Subject to change
26
 Summary
ÆStrong and independent company - board and
management

ÆConstruction and project risks have been minimised

ÆAttractive opportunity for investors

ÆPotential for re-rating once construction is complete

and traffic ramp-up commences

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Questions

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